"You might as well play the lottery..."
Jun. 16th, 2010 07:20 pm![[personal profile]](https://www.dreamwidth.org/img/silk/identity/user.png){kind=small}
libertangoWhen it comes to investing in stocks, it turns out that is an alternative for some people.
From this post at CXO Advisory Group (a bunch of quant-like guys who like to get real data for many assumptions), it turns out there was a recent paper, "Natural Experiments on Individual Trading: Substitution Effect Between Stock and Lottery," by Xiaohui Gao and Tse-Chun Lin of the University of Hong Kong. Gao and Lin took a look at seven years of data from Taiwan (2002-09), and found the higher the jackpot got in the lottery, the lower trading volume in the stock exchange would get.
Sez CXO: "In summary, evidence indicates that gambling opportunities displace stock trading for some individuals (in other words, stock trading is equivalent to gambling for some people). By extension, betting on major sports events may also depress noise trading in stocks."
From this post at CXO Advisory Group (a bunch of quant-like guys who like to get real data for many assumptions), it turns out there was a recent paper, "Natural Experiments on Individual Trading: Substitution Effect Between Stock and Lottery," by Xiaohui Gao and Tse-Chun Lin of the University of Hong Kong. Gao and Lin took a look at seven years of data from Taiwan (2002-09), and found the higher the jackpot got in the lottery, the lower trading volume in the stock exchange would get.
Sez CXO: "In summary, evidence indicates that gambling opportunities displace stock trading for some individuals (in other words, stock trading is equivalent to gambling for some people). By extension, betting on major sports events may also depress noise trading in stocks."
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no subject
Date: 2010-06-17 05:59 pm (UTC)