Gender and Herding

Zheng, Z.; Tang, K.; Liu, Y.; Guo, M.

Abstract

This study uses a unique dataset from a large anonymous brokerage firm to examine the herding behavior of Chinese individual investors. The empirical evidence reveals that females are more inclined to follow the behavior of ‘same-sex’ investors. Market conditions and stock characteristics affect females and males similarly in that individual investors herd more intensively in the bull market, on stocks with better liquidity and larger market capitalization. By using individual-level herding measurements and examining the consequences of intensive herding, we show that the lower portfolio turnover of females is the main source of difference in herding between genders. However, females lose more due to their intensive herding tendency, as herding has a greater negative impact on trading than overconfidence in the Chinese stock market.

Citation

Zheng, Z., Tang, K., Liu, Y., & Guo, M. (2021). Gender and Herding. Journal of Empirical Finance, 64, 379-400. https://doi.org/10.1016/j.jempfin.2021.10.005

• Journal Article Type: Article
• Acceptance Date: Oct 7, 2021
• Online Publication Date: Oct 22, 2021
• Publication Date: 2021-12
• Deposit Date: Oct 7, 2021
• Publicly Available Date: Apr 22, 2023
• Journal: Journal of Empirical Finance
• Print ISSN: 0927-5398
• Electronic ISSN: 1879-1727
• Publisher: Elsevier
• Peer Reviewed: Peer Reviewed
• Volume: 64
• Pages: 379-400
• DOI: https://doi.org/10.1016/j.jempfin.2021.10.005
• Public URL: https://durham-repository.worktribe.com/output/1231538