Herding behaviour in India & China Market: Guest Lecture in JIMS India
Upcoming SlideShare
Loading in...5
×
 

Herding behaviour in India & China Market: Guest Lecture in JIMS India

on

  • 770 views

JIMS Rohini Sec-5 New Delhi organized a guest lecture on HERDING BEHAVIOR IN THE CHINESE AND INDIAN MARKETS conducted by Dr. HARMINDER SINGH, Senior lecturer Deakin University, Australia. Speaker ...

JIMS Rohini Sec-5 New Delhi organized a guest lecture on HERDING BEHAVIOR IN THE CHINESE AND INDIAN MARKETS conducted by Dr. HARMINDER SINGH, Senior lecturer Deakin University, Australia. Speaker explains what is

Statistics

Views

Total Views
770
Views on SlideShare
770
Embed Views
0

Actions

Likes
0
Downloads
9
Comments
0

0 Embeds 0

No embeds

Accessibility

Upload Details

Uploaded via as Microsoft PowerPoint

Usage Rights

© All Rights Reserved

Report content

Flagged as inappropriate Flag as inappropriate
Flag as inappropriate

Select your reason for flagging this presentation as inappropriate.

Cancel
  • Full Name Full Name Comment goes here.
    Are you sure you want to
    Your message goes here
    Processing…
Post Comment
Edit your comment

    Herding behaviour in India & China Market: Guest Lecture in JIMS India Herding behaviour in India & China Market: Guest Lecture in JIMS India Presentation Transcript

    • Herding Behavior in the Chinese and Indian Markets: Guest Lecture in JIMS India
      http://www.flickr.com/photos/freefoto/639294974/sizes/o/
    • JIMS Rohini Sec-5 New Delhi on 21/01/11 organized a guest lecture on the vital topic of HERDING BEHAVIOR IN THE CHINESE AND INDIAN MARKETS conducted by Dr. HARMINDER SINGH, Senior lecturer Deakin University, Australia. Speaker threw light on herding behavior
      Jagan Institute of Management Studies Visit Us @ http://www.jimsindia.org/
    • 1
      What is Herding Behaviour
      Individuals who suppress their own beliefs and base their investment decisions solely on the collective actions of the market, even when they disagree with its prediction (Christie and Hwang, 1995). As per the analyses by various economic luminaries viz. Nofsinger and Sias(1999), Lihara, Kato and Tokunaga(2001), Caparrelli, D’Arcangelis and Cassuto(2004) , Demirer and Kutan (2005), Mason and Nelling (2007) results imply that the herding behavior is more pronounced in the Chinese market than in the Indian market.
      Jagan Institute of Management Studies Visit Us @ http://www.jimsindia.org/
    • When does it exist in Indian and Chinese Market?
      2
      He further took the gathering through some of the test activities undertaken by the aforementioned stalwarts suggesting that herding behaviour is more severe during extreme downward market & indicating the existence of herding behaviour during extreme positive market in the Indian market. Other research work indicated that in BSE herding behaviour do not exist when the market is falling heavily and also that in the Indian market herding behavior exists in extreme up market condition but not in extreme down market condition. Their scrutiny also found that the herding behaviors are more severe when the market is falling in the Chinese market however in BSE 500 suggesting that the herding behavior occurs only during up market.
      Jagan Institute of Management Studies Visit Us @ http://www.jimsindia.org/
    • When does it exist in Indian and Chinese Market?
      Con..
      Further analyses hinted that:
      • In the Chinese stock market, herding behavior exists only in high volume state
      • In the Indian market, herding behavior is not related to the level of trading volume.
      • In the Chinese stock market, during the whole sample period, strong herding behavior shown in all three groups.
      The findings suggest that herding behaviour in India is as a result of the herding on middle-sized stocks. The findings are also in line with those above that herding behavior only exists when the market is climbing up
      “Herding behavior is more significant during the period of global financial crisis in both markets”
      Jagan Institute of Management Studies Visit Us @ http://www.jimsindia.org/
    • 3
      Conclusion
      Based on the overall observation speaker arrived at the following conclusion:
      • The result suggests that herding behaviour exists in both Chinese and Indian stock market
      • Herding in the Chinese stock market is more pronounced than that in the Indian stock market
      • The herding behaviour is more significant during extreme market conditions in both the markets
      • Higher herding behaviour is found when the market is falling in the Chinese stock market. In the Indian market, there is the presence of the herding behaviour only during the up market
      Jagan Institute of Management Studies Visit Us @ http://www.jimsindia.org/
    • Con..
      Conclusion
      The level of herding is greater when the trading volume is high in the Chinese market. In contrast, the level of herding behaviour in the Indian market is unrelated to the size of trading volume
      The magnitude of the herding behaviour in each stock market seems to be affected by the size of the stocks in each stock market and negative effects of the global financial crisis
      More open market and higher ratio of institutional investors may contribute to the less significant herding behaviour in the Indian market
      Foreign and institutional investors are more rational and educated and less likely to heard
      Future research should separate the herding behaviour between individual and institutional investors
      Jagan Institute of Management Studies Visit Us @ http://www.jimsindia.org/
    • Visit Us @ http://www.jimsindia.org/