Trading without meeting friends: Empirical evidence from the wuhan lockdown in 2020

IF 3.6 2区经济学 Q1 BUSINESS, FINANCE

Journal of Banking & Finance Pub Date : 2025-02-01 DOI:10.1016/j.jbankfin.2024.107355

Yichu Huang , Udichibarna Bose , Zeguang Li , Frank Hong Liu

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Abstract

Using a unique proprietary dataset of daily mutual fund trading records and the COVID-19 pandemic-triggered lockdown in Wuhan (China) as a natural experiment, we find that individual mutual fund investors in Wuhan significantly reduced their daily trading frequency, total investment of their portfolios, and risk level of their invested funds during the lockdown period as compared to investors in other cities. The results suggest that the elimination of face-to-face interaction among individual investors during the lockdown reduced their information sharing, which led to more conservatism in their financial trading. We rule out alternative explanations of salience bias due to limited investor attention and temporary changes in personal circumstances such as depression and/or income reduction, during the lockdown period. Finally, consistent with the theory of naïve investor trading, we also find that investors received higher trading returns during the lockdown as they reduced trading aggressively in the absence of face-to-face interactions.

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不见朋友交易：来自2020年武汉封城的经验证据

我们使用独特的共同基金日交易记录专有数据集，并将新冠肺炎疫情引发的武汉封城作为自然实验，发现武汉的个人共同基金投资者在封城期间的日交易频率、投资组合的总投资以及所投资基金的风险水平明显低于其他城市的投资者。结果表明，封锁期间个人投资者之间面对面互动的消除减少了他们的信息共享，导致他们在金融交易中更加保守。我们排除了由于投资者关注有限以及封锁期间个人情况的暂时变化（如抑郁和/或收入减少）而导致的显著性偏差的其他解释。最后，与naïve投资者交易理论一致，我们还发现投资者在封锁期间获得了更高的交易回报，因为他们在缺乏面对面互动的情况下大幅减少了交易。

本文章由计算机程序翻译，如有差异，请以英文原文为准。

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来源期刊

Journal of Banking & Finance Multiple-

CiteScore

6.40

自引率

5.40%

发文量

262

期刊介绍： The Journal of Banking and Finance (JBF) publishes theoretical and empirical research papers spanning all the major research fields in finance and banking. The aim of the Journal of Banking and Finance is to provide an outlet for the increasing flow of scholarly research concerning financial institutions and the money and capital markets within which they function. The Journal''s emphasis is on theoretical developments and their implementation, empirical, applied, and policy-oriented research in banking and other domestic and international financial institutions and markets. The Journal''s purpose is to improve communications between, and within, the academic and other research communities and policymakers and operational decision makers at financial institutions - private and public, national and international, and their regulators. The Journal is one of the largest Finance journals, with approximately 1500 new submissions per year, mainly in the following areas: Asset Management; Asset Pricing; Banking (Efficiency, Regulation, Risk Management, Solvency); Behavioural Finance; Capital Structure; Corporate Finance; Corporate Governance; Derivative Pricing and Hedging; Distribution Forecasting with Financial Applications; Entrepreneurial Finance; Empirical Finance; Financial Economics; Financial Markets (Alternative, Bonds, Currency, Commodity, Derivatives, Equity, Energy, Real Estate); FinTech; Fund Management; General Equilibrium Models; High-Frequency Trading; Intermediation; International Finance; Hedge Funds; Investments; Liquidity; Market Efficiency; Market Microstructure; Mergers and Acquisitions; Networks; Performance Analysis; Political Risk; Portfolio Optimization; Regulation of Financial Markets and Institutions; Risk Management and Analysis; Systemic Risk; Term Structure Models; Venture Capital.