I study a real-options model where the investor computes the value of a project (VOP) from available data. In the process, she makes mistakes, as she suffers from over-confidence and inference biases. I study how the optimal investment rule and timing depend on investors' biases. I show that the...

We provide the first academic study on the performance of IRA pension plans from 2004 through 2018. At the aggregate level, the risk-adjusted performances of IRA plans are comparable to that of the aggregate equity market. However, high-income individuals substantially outperform low-income...

The world interest rate is a key determinant of borrowing and lending behavior and plays a central role in most open-economy macro/finance models. This paper uses a dynamic factor model to construct a world interest rate based on short run interest rates of over 70 countries. Such a process...

We aim to answer whether retail investors have a stabilizing effect on stock prices during times of financial markets turmoil. To achieve this, we examine the liquidity and crash risk of stocks that are likely held by Robinhood traders (i.e., our proxy for retail investors) using the COVID-19...

This paper highlights the importance of financial education and digital literacy in the context of the digitization of the economy. Building on the theoretical grounds established in the literature we use relevant data and statistics from comprehensive studies on financial education, financial...

Purpose - the aim of this study is to specify the factors affecting the non-performing consumer loans in deposit banks operating in Turkey. Besides the internal factors specific to banks, the effect of macroeconomic factors is also investigated. Research methodology - monthly data of deposit...

Despite evidence of the importance of sleep for cognitive performance, prior research finds limited effects of sleep disruptions in financial markets. This is puzzling because financial decisions rely on higher-order cognitive processes that are typically affected by sleep. We reconcile this...

Improved awareness and ageing populations make the exploitation of older persons a growing concern for the finance sector and public policy, especially regarding retirement wealth accumulation. Concurrently, social impact reporting is motivating the banking sector to actively intervene when...

Using the number of Robinhood users holding a firm’s shares, I examine how novice retail investors respond to earnings announcements and the implications of their responses for the price-earnings relation. I do not find evidence of informed trading among these investors. Changes in their...

Using a large panel of U.S. brokerage accounts trades and positions, we show that a large fraction of retail investors trade as contrarians after large earnings surprises, especially for loser stocks, and that such contrarian trading contributes to post earnings announcement drift (PEAD) and...