Investor Logins and the Disposition Effect

Using data from an online brokerage, we examine the role of investor logins in trading behavior. We find that a new reference point is created when an investor logs in and views the investor’s portfolio. We observe this as a disposition effect on returns since last login in addition to the traditional disposition effect on returns since purchase. Further, these reference points produce a strong interaction such that even a small loss since last login nullifies the positive effect of a gain since purchase. This interaction follows if investors select the higher, more aspirational price as a reference point. This paper was accepted by Yuval Rottenstreich, behavioral economics and decision analysis. Funding: This work was supported by the Economic and Social Research Council [Grants ES/K002201/1, ES/N018192/1, ES/P008976/1, and ES/V004867/1] and the Leverhulme Trust [Grant RP2012-V-022]. Supplemental Material: The online appendix and data files are available at https://doi.org/10.1287/mnsc.2022.00359 .

• 저널Management Science
• 토픽Financial Markets and Investment Strategies · Finance
• DOI10.1287/mnsc.2022.00359
• 저자Edika Quispe-Torreblanca, John Gathergood, George Loewenstein, Neil Stewart