Do Early Birds Behave Differently from Night Owls in the Stock Market?

Posted: 20 Oct 2020

See all articles by Grace Lepone

Grace Lepone

Macquarie University, Macquarie Business School

Zhini Yang

affiliation not provided to SSRN

Date Written: April 15, 2020

Abstract

This study is the first to apply human beings' preferred diurnal rhythm, that is, morningness or eveningness, to the field of behavioural finance. Employing proprietary stock trading data from a leading retail brokerage house in Australia, we classify retail investors into M-types (‘early birds’) and E-types (‘night owls’) based on the time of their order submission. Demographic differences between the two groups (M-types or E-types) are found to be weak. We provide robust evidence that M-type investors are distinctively different from E-type investors in their proneness to stock market behavioural biases. We find that M-type investors trade more frequently and have a stronger preference for stock market speculation.

Keywords: Morningness-eveningness, Lottery stocks, Frequent trading, Speculation, Investor bias, Investor characteristics

JEL Classification: G41

Suggested Citation

Lepone, Grace and Yang, Zhini, Do Early Birds Behave Differently from Night Owls in the Stock Market? (April 15, 2020). Pacific-Basin Finance Journal, Vol. 61, 2020, Available at SSRN: https://ssrn.com/abstract=3684964

Grace Lepone (Contact Author)

Macquarie University, Macquarie Business School ( email )

New South Wales 2109
Australia

Zhini Yang

affiliation not provided to SSRN

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Abstract Views
269
PlumX Metrics