Informational overconfidence in return prediction – More properties

Autor: Eran Regev, Doron Sonsino
Rok vydání: 2013
Předmět:
Zdroj: Journal of Economic Psychology. 39:72-84
ISSN: 0167-4870
DOI: 10.1016/j.joep.2013.06.006
Popis: A field experiment revealed 3 forms of unrealistic optimism in skilled investors’ interval predictions of future stock returns. The judgmental intervals were about 50% shorter than realized spreads in recent 3–6 months histories, suggesting that “underestimation of volatility” persists past the financial crisis. The intervals, however, rapidly widened as predictions diverged from zero, and a complementary technical-forecasting experiment showed that the increased spread pattern emerges even when volatility is accounted. The results support “anchoring with noisy monotone adjustments” and suggest that overconfidence hazards may instinctively attenuate when expectations get extreme.
Databáze: OpenAIRE