A Model of Expert Investment Preferences on the Spanish Stock Exchange

Abstract

On the basis of data supplied by 36 questionnaire respondents, the investment preferences of professional investors on the Spanish stock exchange are modeled by ordinal and linear regression analyses in terms of the return, beta value, volatility and R2 of shares and the profits of the company. Ordinal regression was also used to obtain a model specific to the banking sector. The good fit of the models is interpreted as corroborating the rationality of professional investment decisions. In keeping with the experts' subjective assessments of the relative importance of the investment criteria, investment preferences were found to be based primarily on company profits.

Keywords: Stock Exchange, Expert's Behaviour

JEL Classification: G14, C60