Individual Investor Perceptions, Behavior, and Performance During the Financial Crisis

A.O.I. Hoffmann, T. Post, J.M.E. Pennings

Research output: Contribution to conferenceConference paper

Abstract

Abstract: We study how during the financial crisis individual investor perceptions change, impact trading and risk-taking behavior, and explain performance. Based on monthly survey data and matching brokerage records from April 2008 to March 2009, we find that successful investors had higher return expectations and higher risk aversion. Furthermore, they traded less, took less risk, and had lower buy-sell ratios. Investors who outperformed during the height of the crisis (September–October 2008) also performed better before. Afterward, however, they became less risk averse, were no longer less likely to trade, and no longer outperformed, suggesting that their success made them overconfident. Keywords: Investor Perceptions, Investor Behavior, Investor Performance, Financial Crisis
Original languageEnglish
Pages1-50
Publication statusPublished - 2011
Event26th Meeting of the European Economic Association -
Duration: 25 Aug 201129 Aug 2011

Conference

Conference26th Meeting of the European Economic Association
Period25/08/1129/08/11

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  • Cite this

    Hoffmann, A. O. I., Post, T., & Pennings, J. M. E. (2011). Individual Investor Perceptions, Behavior, and Performance During the Financial Crisis. 1-50. Paper presented at 26th Meeting of the European Economic Association, .