The Effect of Price Path on Satisfaction and Future Behavior of Investors
Quarterly Journal of Securities Exchange

Quarterly Journal of Securities Exchange

The Effect of Price Path on Satisfaction and Future Behavior of Investors

Document Type : Original Article

Authors
Mohammad Mahdi Bahrololoum 1
Moslem Peymany 1
Babak Khangholi 2
1 Assistant Professor of Finance and Banking, Faculty of Management and Accounting, Allameh Tabatabai University
2 M.A in Financial Management, Allameh Tabatab'i University
10.22034/jse.2021.11524.1659
Abstract
Investor behavior and factors affecting investment decisions are important issues that researchers have been seeking to provide a comprehensive model for interpreting in recent years. In this regard, the present study with the behavioral finance approach has investigated the effect of share price path on investment satisfaction and future behavior of investors. In this study, a series of experiments examining share price paths was analyzed. The results showed that the share price path had an impact on investment satisfaction. Regardless of whether or not the final return is positive or negative, the downward-upward price path doubles the upward-downward path of investment satisfaction. The results also showed that expected returns and risk will also change significantly under the influence of different price opportunities with identical returns. On the other hand, the indirect path increases the share of tendency to hold stocks, which is indicative of the bias of disposition effect on the investors concerned.
Keywords
Behavioral finance
Experimental finance
Satisfaction
Disposition effect
Price path
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Quarterly Journal of Securities Exchange
Volume 15, Issue 58
Summer 2022
Pages 101-120