Religious Beliefs, Gambling Preferences, and Superstitious Individual Investor Trading Behaviors

56 Pages Posted: 9 Jul 2019

See all articles by Dien Giau Bui

Dien Giau Bui

National Taiwan University, Department of Finance, Students

Yan-Shing Chen

National Taiwan University

Yehning Chen

National Taiwan University

Chih-Yung Lin

National Chiao-Tung University

Date Written: February 1, 2019

Abstract

Using religious festivals in Taiwan as repeated natural experiments, we examine whether the religious beliefs of individual investors influence their trading behaviors. Based on the assumption that religious festivals draw superstitious individual investors participating and make them feel lucky after attending the festival. We find that they have larger trading turnovers and lower investment returns if they have higher gambling preferences. Besides, this effect becomes stronger in preferred stocks of individual investors and lottery-like stocks, supporting that individual investors consider trading as an exciting gambling activity. Overall, our evidence suggests that religious beliefs influence individual investors trading behaviors.

Keywords: Religious beliefs; gambling preferences; individual investors; trading volume; investment return

JEL Classification: G11, G12, G14, G40

Suggested Citation

Bui, Dien Giau and Chen, Yan-Shing and Chen, Yehning and Lin, Chih-Yung, Religious Beliefs, Gambling Preferences, and Superstitious Individual Investor Trading Behaviors (February 1, 2019). Available at SSRN: https://ssrn.com/abstract=3416017 or http://dx.doi.org/10.2139/ssrn.3416017

Dien Giau Bui

National Taiwan University, Department of Finance, Students ( email )

1, Sec. 4, Roosevelt Road
Taipei
Taiwan

Yan-Shing Chen

National Taiwan University ( email )

1 Sec. 4, Roosevelt Road
Taipei 106, 106
Taiwan

Yehning Chen

National Taiwan University ( email )

1 Sec. 4, Roosevelt Road
Taipei, 106
Taiwan

Chih-Yung Lin (Contact Author)

National Chiao-Tung University ( email )

Taiwan

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