Thy Neighbor’s Portfolio: Word-of-Mouth Effects (2002)
| Venue: | Ohio State University |
| Citations: | 25 - 2 self |
BibTeX
@INPROCEEDINGS{Hong02thyneighbor’s,
author = {Harrison Hong and Jeffrey D. Kubik and Jeremy C. Stein and Karl Lins and Andrei Shleifer and Jeff Wurgler},
title = {Thy Neighbor’s Portfolio: Word-of-Mouth Effects},
booktitle = {Ohio State University},
year = {2002}
}
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Abstract
Abstract: A mutual-fund manager is more likely to hold (or buy, or sell) a particular stock in any quarter if other managers in the same city are holding (or buying, or selling) that same stock. This pattern shows up even when controlling for the distance between the fund manager and the stock in question, so it is distinct from a local-preference effect. It is also robust to a variety of controls for investment styles. These results can be interpreted in terms of an epidemic model in which investors spread information about stocks to one another by word of mouth.
