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- Title
THE IMPACT OF BEHAVIORAL PITFALLS ON INVESTORS' DECISIONS: THE DISPOSITION EFFECT IN THE TAIWANESE WARRANT MARKET.
- Authors
Chih-Hsiang Chang
- Abstract
Investors in the Taiwanese warrant markets were investigated to examine the existence of the disposition effect to sell winners too early and hold losers too long. Empirical results indicate that: first, both the disposition effect and house money effect exist in the Taiwanese warrant market. Secondly, the issuance price of a warrant is the predominant reference for investors to make strategic decisions. Furthermore, subloser investors are more concerned with the new high more than with the new low when they make a strategic decision. In the end, warrants with different issuance prices, warrants with different returns, and warrants with different market prices were found to exhibit the differentiated disposition behavior.
- Subjects
TAIWAN; INVESTORS; ETHNOLOGY; BUSINESSPEOPLE; STAKEHOLDERS; CORPORATE raiders; PARTNERSHIP dissolution (Business); DISTRIBUTION of partnership interests; BUSINESS partnerships; BUSINESS enterprises
- Publication
Social Behavior & Personality: an international journal, 2008, Vol 36, Issue 5, p617
- ISSN
0301-2212
- Publication type
Article
- DOI
10.2224/sbp.2008.36.5.617