Investor PSY-chology Surrounding 'Gangnam Style'
Y. Han (Andy) Kim
Nanyang Technological University (NTU)
Bank of Korea
April 14, 2014
The global success of “Gangnam Style,” by the Korean rapper PSY in 2012, was an exogenous shock to investor enthusiasm about PSY’s father’s semiconductor company, DI Corp., because the family relation was publicized in various countries in early stage. Using the count of flash mob videos on YouTube from each country as the proxy for the enthusiasm of individual investors, we find non-resident (resident) foreign individual investors became net buyers (sellers) of DI Corp. when flash mobs were uploaded in their countries. We find consistent trading behavior of domestic individual investors, which drove the price up by 800% without information. Overall, the case shows that non-informative attention can sometimes drive the price away from fundamentals.
Number of Pages in PDF File: 65
Keywords: Gangnam Style, flash mob, bubble, individual investors, foreign investors, media, market efficiency
JEL Classification: G02, G14, G12, G18working papers series
Date posted: July 12, 2013 ; Last revised: April 15, 2014
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