Prior gains and subsequent trade size: The moderating role of news announcements

He He, Tiejun Ma, Ming-Chien Sung, Johnnie E.V. Johnson

Research output: Contribution to conferenceAbstractpeer-review

Abstract / Description of output

We examine an dataset of 285,725 trades of 4,857 retail traders from 2004 to 2013, matched to a news archive of over 20 million news items. We find that individuals increase trade size following prior gains, but the magnitude of the increase depends on news sentiment - amplified/reduced by the news sentiment that was consistent/inconsistent with the prior gain-generating decisions. The findings suggest that individual traders may respond differently to the same piece of news depending upon the relationship between the news sentiment and their prior gains (i.e. consistent or not), thus providing individual-level evidence for models based on heterogeneous beliefs of investors.
Original languageEnglish
Publication statusPublished - 24 Oct 2021
Event2021 INFORMS Annual Meeting - In Person & Virtual, Anaheim, United States
Duration: 24 Oct 202127 Oct 2021


Conference2021 INFORMS Annual Meeting
Country/TerritoryUnited States
Internet address

Keywords / Materials (for Non-textual outputs)

  • Behavioral operations
  • Decision analysis
  • Risk analysis


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