UM
Round-number biases and informed trading in global markets
Chen, Tao
2018-11
Source PublicationJOURNAL OF BUSINESS RESEARCH
ISSN0148-2963
Volume92Pages:105-117
AbstractThis paper investigates whether informed trading matters to round-number biases. We document the global presence of round-number biases by showing excessive buying (selling) pressure immediately below (above) a rounded threshold. Additionally, we demonstrate that trades surrounding 0-ending prices are likely to be initiated by informed traders who tend to buy (sell) at 9-ending (1-ending) prices. Moreover, small-sized (medium-sized) trades with 1-ending or 9-ending prices are revealed to be more informative and conducted persistently. Collectively, these findings seem to suggest that informed investors strategically engage in stealth trading by leveraging round-number biases of liquidity traders, which indirectly drives this anomaly in global markets.
KeywordRound-number bias Informed trading Global market Behavioral finance
DOI10.1016/j.jbusres.2018.07.027
URLView the original
Indexed BySSCI
Language英语
WOS Research AreaBusiness & Economics
WOS SubjectBusiness
WOS IDWOS:000446285000010
PublisherELSEVIER SCIENCE INC
The Source to ArticleWOS
Fulltext Access
Citation statistics
Cited Times [WOS]:4   [WOS Record]     [Related Records in WOS]
Document TypeJournal article
CollectionUniversity of Macau
Recommended Citation
GB/T 7714
Chen, Tao. Round-number biases and informed trading in global markets[J]. JOURNAL OF BUSINESS RESEARCH,2018,92:105-117.
APA Chen, Tao.(2018).Round-number biases and informed trading in global markets.JOURNAL OF BUSINESS RESEARCH,92,105-117.
MLA Chen, Tao."Round-number biases and informed trading in global markets".JOURNAL OF BUSINESS RESEARCH 92(2018):105-117.
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