Trading as Entertainment?

Trading as Entertainment?

Among 1,000 German brokerage clients for whom both survey responses and actual trading records are available, investors who report enjoying investing or gambling turn over their portfolio at twice the rate of their peers. Including entertainment attributes as additional explanatory variables in cros...

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Veröffentlicht in:Management science 2009-04, Vol.55 (4), p.591-603
Hauptverfasser: Dorn, Daniel, Sengmueller, Paul
Format: Artikel
Sprache:eng
Schlagworte:
Applied sciences
Behavior
Brokerages
Cost control
Decision making
Decision theory. Utility theory
Entertainment
Exact sciences and technology
Financial investments
Financial portfolios
Gambling
Germany
Herfindahl Hirschman index
Hypotheses
investor decision making
Investors
Management
Management science
Methods
Motivation
Mutual funds
Operational research and scientific management
Operational research. Management science
Portfolio management
Portfolio selection
Portfolio theory
Proxies
Regression analysis
Securities markets
Securities trading
Stock exchange
Stocks
Studies
Trade
Trade volume
trading volume
Variables
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Beschreibung
Zusammenfassung:Among 1,000 German brokerage clients for whom both survey responses and actual trading records are available, investors who report enjoying investing or gambling turn over their portfolio at twice the rate of their peers. Including entertainment attributes as additional explanatory variables in cross-sectional regressions of portfolio turnover on objective investor attributes more than doubles the fraction of the total variation of portfolio turnover that can be explained. The results are robust to controlling for gender and proxies for overconfidence constructed from survey responses. Nonpecuniary benefits of trading thus appear to offer a straightforward explanation of the "excessive trading puzzle."
ISSN:0025-1909
1526-5501
DOI:10.1287/mnsc.1080.0962