Journal of Financial Economics Vol. 143 No. 2 2022
Attention triggers and investors’ risk-taking
Abstract
This paper investigates how individual attention triggers influence financial risk-taking based on a large sample of trading records from a brokerage service that sends standardized push messages on stocks to retail investors. By exploiting the data in a difference-in-differences (DID) setting, we find attention triggers increase investors’ risk-taking. Our DID coefficient implies attention trades carry, on average, a 19 percentage-point-higher leverage than non-attention trades. We provide a battery of cross-sectional analyses to identify the groups of investors and stocks for which this effect is stronger.
- DOI
- 10.1016/j.jfineco.2021.05.031
- Volume
- 143
- Issue
- 2
- Pages
- 846-875
- Language
- en
- Sources
- bibtex:phds-export.bib openalex crossref