IUP Journal of Behavioral Finance

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A Bayesian Analysis of Lunar Effects On Stock Returns

Biological, psychological and medical evidence widely suggests that the lunar phases may affect human behavior and mood. This suggestion motivates this study of the relationship between lunar phases and stock returns. Relevant papers indicate that lunar cycle effects do have an effect on stock returns. They indicate that the mean daily stock returns are lower near the full moon and higher near the new moon days. This paper further investigates the association between the lunar phases and dail...

A Dynamic Variation of Risk Aversion Approach: A Study of Momentum and Reversal Premiums

This paper integrates dynamic loss aversion and individual narrow framing in the investor utility function. The paper investigates investor behavior following the public announcement of earnings. To do this, the author optimizes the objective function of investor preference and analyzes to what extent the preference function generates a differential of value premium between stocks after the announcement of the firms' profits. Several simulations are used according to the different values cons...

An Analysis of the Behavior of Teaching Community Towards Consumption: A Case Study

It is widely acknowledged in the literature of household economics that economic behavior will have a strong influence on work efficiency, and the degree of influence would vary from profession to profession and over the time. Economic attitudes are generally explained by the consumption patterns, savings and investments. Attitude of teachers towards consumption, saving and investment would reflect their economic behavior, which would influence their profession, and in turn on the education s...

Investment Behavior and the Indian Stock Market Crash 2008: An Empirical Study of Student Investors

The year 2008 has been a year of global slowdown and slump for the global equity market, in general and stock markets of India, in particular. During 2008, Sensex (BSE Index) fell down from 21,206 (Indian Historical High of Sensex) to 16,000 points in a single month, i.e., in January 2008. In October 2008, it crossed the support level of 8,000 points. Weak global atmosphere coupled with heavy selling by FIIs and hedge funds led to this market crash. Against this backdrop, this paper analyzes ...

Measurement of Conformity to Behavior Finance Concepts and Association with Individual Personality

Behavioral Finance is the study that links social and psychological concepts to investments. Studies have now shown that investment is not purely a rational decision but has roots in social sciences, such as sociology and psychology. Many paradoxes that have been unexplained by classical finance are now being deciphered using behavioral finance concepts. Since behavioral finance has social-psychological roots, the tendency to behave as predicted by it must have personality dimensions. This pa...

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