Monday irrationality of investors in bursa Malaysia: The role of psychological biases

Brahmana, Rayenda and Chee-Wooi, Hooy and Zamri, Ahmad (2015) Monday irrationality of investors in bursa Malaysia: The role of psychological biases. Malaysian Journal of Economic Studies, 52 (2). pp. 227-243. ISSN 15114554

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Abstract

This study aims to investigate the role of psychological biases in determining the day-of-the-week Monday irrationality in Bursa Malaysia using daily data from 1 January 1999 until 30 December 2011. First, our findings proved the existence of Monday irrationality in Bursa Malaysia. Second, our analysis found significant relationships between psychological biases and Monday irrationality. Evidence was documented through the interactive model and day-by-day model. This study enriches the behavioural finance literature by falsifying the traditional utility function model. It proves that the hedonic utility and prospect theory are applicable for the case of this study. Feelings of investors are involved in trading, and they react differently on Monday because of psychological biases. This implies that investors or fund managers can beat the market by following the cycle of calendar anomalies.

Item Type: Article
Uncontrolled Keywords: Behavioural economics,Monday irrationality,psychological biases, Bursa Saham Kuala Lumpur, unimas, university, universiti, Borneo, Malaysia, Sarawak, Kuching, Samarahan, ipta, education,research, Universiti Malaysia Sarawak
Subjects: H Social Sciences > HB Economic Theory
H Social Sciences > HM Sociology
Divisions: Academic Faculties, Institutes and Centres > Faculty of Economics and Business
Depositing User: Saman
Date Deposited: 16 May 2016 02:22
Last Modified: 21 Oct 2016 07:25
URI: http://ir.unimas.my/id/eprint/12018

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