Investor behavior and weather factors: evidences from Asian region

The behavioral finance studies generally analyse the relationship between investor moods, caused by weather factors and indices returns via investor moods. The present study examines the relationship between three weather factors (temperature, humidity, and wind speed) in capital cities (namely Beij...

Full description

Saved in:
Bibliographic Details
Published in:Annals of operations research 2021-04, Vol.299 (1-2), p.349-373
Main Authors: Kathiravan, Chinnadurai, Selvam, Murugesan, Venkateswar, Sankaran, Balakrishnan, S.
Format: Article
Language:English
Subjects:
Behavior
Behavioral economics
Business and Management
Causality
Combinatorics
Finance
Financing
Humidity
Influence
Investment
Investments
Investors
Moods
Operations research
Operations Research/Decision Theory
S.I. : Recent Developments in Financial Modeling and Risk Management
Securities markets
Speed
Statistical tests
Stock exchanges
Stock market indexes
Stock price indexes
Temperature
Theory of Computation
Weather
Wind speed
Winds
Citations: Items that this one cites
Items that cite this one
Online Access:Get full text
Tags: Add Tag
No Tags, Be the first to tag this record!
Description
Summary:The behavioral finance studies generally analyse the relationship between investor moods, caused by weather factors and indices returns via investor moods. The present study examines the relationship between three weather factors (temperature, humidity, and wind speed) in capital cities (namely Beijing for China, Tokyo for Japan, Victoria City for Hong Kong, New Delhi for India and Singapore for Singapore), and sample stock indices (Shanghai Stock Exchange from China, Nikkei 225 from Japan, Hang Seng Index from Hong Kong, BSE Sensex from India and Singapore Exchange Limited from Singapore) of selected Asian countries. This study applied statistical tools like Descriptive Statistics, ADF Test, VAR Module and adopted the Granger Causality Approach. The found that among the three weather variables, temperature recorded a statistically significant influence on the returns of Shanghai Stock Exchange (Unidirectional Linkage), HANG SENG Index (Unidirectional Linkage) and also BSE Sensex (Bi-Directional Linkage). Wind speed recorded Bi-Directional Linkages with HANG SENG Index. The findings of this study could help the investors in making better investment management decisions. It is found that there are valuable opportunities to international investors for diversifying their stocks. The study does contribute to the behavioral finance literature.
ISSN:0254-5330
1572-9338
DOI:10.1007/s10479-019-03335-7