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- Title
Stock market and the psychological health of investors.
- Authors
Liu, Chang; Fan, Maoyong
- Abstract
Utilizing a national individual‐level medical dataset and the home bias phenomenon in investment, our study shows a strong and robust link between declines in local stock returns and increased antidepressant consumption among investors. This effect intensifies in areas with higher per capita dividend income, suggesting a direct relationship between higher stock ownership and stronger responses. We confirm that portfolio losses, not local economic conditions, are responsible for increased antidepressant usage during market downturns. Using the frequency of psychotherapy sessions yields similar findings. Moreover, our study supports the loss aversion hypothesis as we find positive stock returns do not influence antidepressant usage.
- Subjects
INVESTORS; RATE of return on stocks; STOCKS (Finance); STOCK ownership; LOSS aversion; PSYCHOTHERAPY
- Publication
Financial Review, 2024, Vol 59, Issue 3, p561
- ISSN
0732-8516
- Publication type
Article
- DOI
10.1111/fire.12385