Journal of Consumer Research 2002

Taking Stock of Stockbrokers: Exploring Momentum versus Contrarian Investor Strategies and Profiles

Maureen Morrin¹; Jacob Jacoby²; Gita Venkataramani Johar³; Xin He¹; Alfred Kuß⁴; David Mazursky^5,6

¹ University of Pittsburgh · ² New York University · ³ Columbia University · ⁴ Freie Universität Berlin · ⁵ Hebrew University of Jerusalem · ⁶ Bocconi University

Abstract

Two studies were conducted among professional security analysts to explore their patterns of decision making while managing investment portfolios. In study 1, a computer-based simulation, the analysts' styles differed markedly, with most exhibiting either a momentum or contrarian approach, as indicated by responses to portfolio stock price changes. Study 2 used a verbal protocol procedure and semistructured depth interviews to probe the analysts' thought processes. Momentum and contrarian investors were found to differ on a number of dimensions including price expectations, age, experience, raw performance, risk propensity, cognitive style, knowledge calibration, and strategy adaptivity. Implications and limitations are discussed.

DOI

10.1086/341570

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