Stock Investments at Work

Hvide, Hans K.; Östberg, Per

doi:10.2139/ssrn.2255330

Download This Paper

Open PDF in Browser

Add Paper to My Library

Stock Investments at Work

58 Pages Posted: 24 Apr 2013 Last revised: 6 Aug 2019

See all articles by Hans K. Hvide

Hans K. Hvide

University of Bergen - Department of Economics; University of Aberdeen - Business School; Centre for Economic Policy Research (CEPR); Institute for the Study of Labor (IZA)

Per Östberg

University of Zurich - Department of Banking and Finance; Swiss Finance Institute

There are 2 versions of this paper

Date Written: January 17, 2014

Abstract

Stock market investment decisions of individuals are positively correlated with that of co-workers. Sorting of unobservably similar individuals to the same workplaces is unlikely to explain our results, as evidenced by the investment behavior of individuals that move between plants. Purchases made under stronger co-worker purchase activity are not associated with higher returns. Moreover, social interaction appears to drive the purchase of within-industry stocks; an investment mistake. Overall, our results suggest a strong influence of co-workers on investment choices, but not an influence that improves the quality of investment decisions.

Keywords: Individual investors, peer effects, social interaction, investment decisions, stock selection

JEL Classification: G02, G11

Suggested Citation: Suggested Citation

Hvide, Hans and Östberg, Per, Stock Investments at Work (January 17, 2014). Available at SSRN: https://ssrn.com/abstract=2255330 or http://dx.doi.org/10.2139/ssrn.2255330