The disposition effect in the absence of taxes

I measure household investment decisions undertaken in a setting that is free from investment taxes. The disposition effect is unequivocally present, but any seasonal impact of tax-loss selling is absent. There is evidence that the disposition effect correlates positively with inferior risk-adjusted investment performance. Although household preferences are unknown, losses cannot be explained by tax benefits

Los Factores Sociales que Influyen en el Embarazo y en el uso de Anticonceptivos de Adolescentes en el Barrio 25 de Mayo, Maipú, Mendoza.

Background: Adolescent pregnancy is a common phenomenon among those living in poverty. Adolescent pregnancy is influenced by many social and cultural factors, leading to lack of use of contraceptives. This study took place in the neighborhood 25 de Mayo, in the city of Maipú, Mendoza in Argentina. This community is mostly composed of people with low incomes and limited education. Socioeconomic and the attitudes toward teenage pregnancy, as well as the use of contraceptives by adolescents, are distinct from those in wealthier better educated groups. This neighborhood is approximately 10,000 people, the majority of whom are women. Most of the women in this community do not attend secondary school, and almost none have health coverage. The poverty of this community has a strong effect on the culture around adolescent pregnancy. The study was based in the “Centro Integrador Comunitario 907°” (CIC), or integrated community center. In this CIC there is a reproductive health program intended to increase the use of contraception and improve the reproductive health of the woman in the community. The work of the health professionals in this CIC was fundamental to the analysis in this study. Methodology: The study is based on interviews with people with different perspectives on adolescent pregnancy and the use of contraception in the neighborhood 25 de Mayo. Thirteen women between the ages of 14 and 19, who have had at least one child, were interviewed regarding their own experiences and thoughts about the use of contraceptives, and their thoughts about use of contraceptives in the community. In addition, different professionals in the CIC 907° were interviewed. This includes two health agents, one social worker, and one doctor. They provided distinct perspectives on this topic as well. The health agents and the social worker have close relationships with the members of the community, and they all provided essential information about the state of reproductive health, in particular adolescent pregnancies, in this community. Furthermore, two researchers of reproductive health in Buenos Aires and Mendoza were interviewed, to provide information about the situation of adolescent pregnancy in the country in general. Also, a secondary database was utilized. This database was collected by the social worker who provides all consultations about contraception in the community. The database has demographic information and information about the state of reproductive health of all the women who have had consultations about contraception in the CIC 907°. Results: The interviews with adolescent mothers showed variation in experiences and opinions about contraceptives, and access to information about reproductive health. The interviews with health professionals, and also with researchers, showed that adolescent pregnancies are often intentional, and therefore not necessarily due to a lack of access to contraception, but rather due to cultural and societal factors. The interviews and secondary sources showed that there are many social and cultural causes for adolescent pregnancy, and for the lack of use of contraceptives in the neighborhood 25 de Mayo. These causes include lack of education, the expectation of women to be mothers, the lack of acceptance of women’s sexuality, the ideology and beliefs against the use of contraception, myths about contraception, lack of sex education, the dynamic between doctors and their patients, and the dynamic between sexual partners that discourages the use of contraception and encourages teenage pregnancy. The prevalence of adolescent pregnancy is integrated with the culture and socioeconomic situation of this community

Sex Differences in Gains Among Hispanic Pre-kindergartners’ Mental Rotation Skills

The current study explores change in mental rotation skills throughout the pre-kindergarten year in a Hispanic population to better understand the development of early sex differences in mental rotation. Ninety-six Hispanic children (M = 4 years 8 months) completed a mental rotation task at the beginning and end of pre-kindergarten. Results suggest Hispanic boys and girls differed in gains on mental rotation ability, with boys improving significantly more than girls during pre-kindergarten on a mental rotation task. This study highlights the significance of studying mental rotation abilities in a Hispanic population of pre-kindergarten aged children and suggests the importance of examining sex differences in mental rotation over time, rather than at one time-point, to better understand when sex differences in spatial skills develop. We discuss various factors that potentially affect the growth of spatial skills including the role of early education, spatial experiences, and spatial language input

Sovereign Default Risk, Overconfident Investors and Diverse Beliefs: Theory and Evidence from a New Dataset on Outstanding Credit Default Swaps

In standard public finance theory a government’s cost of borrowing depends on the common beliefs held by rational investors regarding default risk. We advance understanding of the effects of diverse beliefs and overconfidence among investors in their ability to assess the sovereign’s creditworthiness. Theoretically, we find that demand for insurance against default is positively related to the absolute difference between the market price of sovereign risk and the risk forecasted by the economy’s fundamentals. We find preliminary support for this prediction in a newly available dataset on sovereign credit default swaps (CDSs): after controlling for the size of the public debt, the absolute size of the gap between the actual and forecasted spreads is positively related to the value of outstanding CDSs

Strategies used as spectroscopy of financial markets reveal new stylized facts

We propose a new set of stylized facts quantifying the structure of financial markets. The key idea is to study the combined structure of both investment strategies and prices in order to open a qualitatively new level of understanding of financial and economic markets. We study the detailed order flow on the Shenzhen Stock Exchange of China for the whole year of 2003. This enormous dataset allows us to compare (i) a closed national market (A-shares) with an international market (B-shares), (ii) individuals and institutions and (iii) real investors to random strategies with respect to timing that share otherwise all other characteristics. We find that more trading results in smaller net return due to trading frictions. We unveiled quantitative power laws with non-trivial exponents, that quantify the deterioration of performance with frequency and with holding period of the strategies used by investors. Random strategies are found to perform much better than real ones, both for winners and losers. Surprising large arbitrage opportunities exist, especially when using zero-intelligence strategies. This is a diagnostic of possible inefficiencies of these financial markets.Comment: 13 pages including 5 figures and 1 tabl

Turnover, account value and diversification of real traders: evidence of collective portfolio optimizing behavior

Despite the availability of very detailed data on financial market, agent-based modeling is hindered by the lack of information about real trader behavior. This makes it impossible to validate agent-based models, which are thus reverse-engineering attempts. This work is a contribution to the building of a set of stylized facts about the traders themselves. Using the client database of Swissquote Bank SA, the largest on-line Swiss broker, we find empirical relationships between turnover, account values and the number of assets in which a trader is invested. A theory based on simple mean-variance portfolio optimization that crucially includes variable transaction costs is able to reproduce faithfully the observed behaviors. We finally argue that our results bring into light the collective ability of a population to construct a mean-variance portfolio that takes into account the structure of transaction costsComment: 26 pages, 9 figures, Fig. 8 fixe

Momentum and the Disposition Effect: The Role of Individual Investors

We hypothesize that disposition effect-induced momentum documented in Grinblatt and Han (2005) should be stronger in stocks with greater individual investors’ presence since individual investors are more prone to the disposition effect. We find strong evidence for our hypothesis for a large sample of NYSE/AMEX/NASDAQ stocks from the end of 1980 to 2005. Our results hold across different momentum strategies using alternative ways of defining individual investors’ presence in a stock and maintain even after controlling for variables known to drive momentum. Furthermore, we find that our results are stronger for hard-to-value stocks consistent with the findings of Kumar (2009).Peer Reviewedhttp://deepblue.lib.umich.edu/bitstream/2027.42/79368/1/j.1755-053X.2010.01107.x.pd