تلخیص
Investors are thought of as rational individuals, who carefully take all economic
decisions every time. But irregularities were noticed in the behavior of investors
when economy of the world was shaken by the Financial Crisis of 2008 that
started off in the USA and resulted in global recession. The news of
international financial crisis affects investment strategies and help to estimate
the shock absorbing abilities of capital market. Investors use heuristics in their
financial decisions whenever they are faced with uncertain situation. For this
study we have collected data of ten years (2005-2014) of 229 companies listed
in all sectors of Pakistan stock exchange to find out the impact of behavioral
heuristics on investment decisions of Pakistani investors. We have used Logit
regression to find the relationship between disposition effect, anchoring heuristic
and overconfidence bias of investors in Pakistani stock market. We have found
that disposition effect and anchoring heuristic is used by Pakistani investors in
their financial decision making and it helps them to generate positive returns.
Overconfidence has negative but significant effect on investment returns for the
investors.
Shagufta Parveen, Muhammad Ayub Siddiqui. (2018) Anchoring Heuristic, Disposition Effect and Overconfidence Bias in Investors: A Case of Pakistan Stock Exchange, Abasyn Journal of Social Sciences, Volume-11, Issue-2.
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