Herd Behaviour in Financial Markets: Do Traders Follow the Crowd or Do Their Own Thing?

Authors

Knowledge@SMU

Publication Type

Journal Article

Publication Date

7-2008

Abstract

In financial markets, what part of a trader’s action is simply “following the crowd” or herding, and how much is based on the trader’s own information? Herding has been shown to decrease the stability and efficiency of markets, hence the interest in these behaviours. Marco Cipriani (Asian Division, IMF Institute) and Antonio Guarino (University College London) studied herd behaviour in a laboratory setting involving financial market professionals. Cipriani presented a co-authored IMF working paper on herd behaviour in financial markets at a recent seminar at the Singapore Management University. --------------------------------------------------------------------------------

Disciplines

Accounting | Business | Finance and Financial Management

Copyright Owner and Holder

Copyright © Singapore Management University 2012

Licece/Creative Commons Licence

This work is licensed under a Creative Commons Attribution-NonCommercial-No Derivative Works 4.0 International License.

Article ID

1146

Subject(s)

Finance and Accounting

Citation

Knowledge@SMU. Herd Behaviour in Financial Markets: Do Traders Follow the Crowd or Do Their Own Thing?. (2008).
Available at: https://ink.library.smu.edu.sg/ksmu/56