Do All Individual Investors Lose by Trading?

52 Pages Posted: 25 Feb 2010 Last revised: 21 Mar 2010

See all articles by Wei Chen

Wei Chen

University of Arizona - Eller College of Management

Zhuwei Li

affiliation not provided to SSRN

Yongdong Shi

Dongbei University of Finance and Economics (DUFE)

Date Written: February 18, 2010

Abstract

We document that not all individual investors who participate in stock market pay a tremendous performance penalty for active trading from a unique dataset including the complete transaction history and account information of all shareholders in Chinese Mainland. During our sample period, for the limited investment tools and less sophisticated knowledge and technology, the less wealthy individuals incur economically large losses. Finally, we give the international comparisons of existing studies and market situations, presenting that the trading performance patterns of individuals and institutions are similar in the world whether the market situations are different or not.

Keywords: Behavioral Finance, Account Information, Trading Strategy, Disposition Effect

JEL Classification: G10, G1, G28, C22

Suggested Citation

Chen, Wei and Li, Zhuwei and Shi, Yongdong, Do All Individual Investors Lose by Trading? (February 18, 2010). Available at SSRN: https://ssrn.com/abstract=1557529 or http://dx.doi.org/10.2139/ssrn.1557529

Wei Chen

University of Arizona - Eller College of Management ( email )

McClelland Hall
P.O. Box 210108
Tucson, AZ 85721-0108
United States

Zhuwei Li

affiliation not provided to SSRN ( email )

Yongdong Shi (Contact Author)

Dongbei University of Finance and Economics (DUFE) ( email )

School of Finance
Dalian 116025
China
+86-411-4712805 (Phone)
+86-411-4710432 (Fax)

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