ScienceDirect Publication: Finance Research Letters
Tue, 19 Nov 2019 12:01:37 GMT language
Publication date: December 2019
Source: Finance Research Letters, Volume 31
Author(s): Kȩstutis Baltakys, Margarita Baltakienė, Hannu Kärkkäinen, Juho Kanniainen
The starting point of this paper is that neighboring investors may talk to each other sharing information about their transactions in stock markets, leading to similar trading behavior. We find that pairwise trade timing similarities between investor pairs are negatively associated to geographical distance between corresponding investor pairs. This suggests that local information transfer channels between neighboring individual investors are used in decision making. We also observe that differences in age and language moderate this association. The analysis is conducted using investor level data from different regions of Finland.