Comparing Investor Networks in Different Market Conditions

9 Pages Posted: 11 May 2020 Last revised: 29 Oct 2020

See all articles by Viet Hung Le

Viet Hung Le

Faculty of Information Technology and Communication Sciences, Tampere University

Date Written: April 14, 2020

Abstract

We investigate investor behaviors before and during the global financial crisis of 2007-2008 using complex network theory. We find that investor networks have different structures between pre-crisis and crisis periods with statistical significance. Moreover, we observe the herding tendency and high synchronization in trade timing during the crisis, which is supported by the literature. These findings can be used to develop early-warning signals for crises in stock markets.

Keywords: Investor networks; Herding; Financial crisis; Network comparison

JEL Classification: G01, G02

Suggested Citation

Le, Viet Hung, Comparing Investor Networks in Different Market Conditions (April 14, 2020). Available at SSRN: https://ssrn.com/abstract=3575664 or http://dx.doi.org/10.2139/ssrn.3575664

Viet Hung Le (Contact Author)

Faculty of Information Technology and Communication Sciences, Tampere University ( email )

Finland

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