The Influence of Investor Sentiment on Stock Market

Yu Zhou

doi:10.54254/2754-1169/42/20232078

Research Article

Open access

Published on 10 November 2023

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Zhou,Y. (2023). The Influence of Investor Sentiment on Stock Market. Advances in Economics, Management and Political Sciences,42,49-56.

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The Influence of Investor Sentiment on Stock Market

Yu Zhou *^,1,

¹ Xi'an Jiaotong-Liverpool University

* Author to whom correspondence should be addressed.

https://doi.org/10.54254/2754-1169/42/20232078

Abstract

By combining economics, psychology, and neuroscience, behavioral finance aims to analyze how human emotions and biases influence financial decision-making. The research utilizes the Investor Sentiment Index (CICSI) as a tool to measure market sentiment and examines its correlation with variables such as IPO first-day returns, turnover rate, and new account openings. The findings demonstrate that investor sentiment significantly impacts market behavior. This suggests that individual emotions and cognitive biases play a crucial role in shaping market trends. These conclusions provide valuable insights for investors, financial analysts, and policymakers seeking to better understand and predict market behavior. By incorporating behavioral finance insights into traditional financial models, a more comprehensive understanding of financial markets can be achieved, enabling informed decision-making.

Keywords

sentiment, IPO first-day earnings, turnover rate, number of newly opened accounts

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Cite this article

Zhou,Y. (2023). The Influence of Investor Sentiment on Stock Market. Advances in Economics, Management and Political Sciences,42,49-56.

Data availability

The datasets used and/or analyzed during the current study will be available from the authors upon reasonable request.

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About volume

Volume title: Proceedings of the 7th International Conference on Economic Management and Green Development

Conference website: https://www.icemgd.org/

ISBN：978-1-83558-105-6(Print) / 978-1-83558-106-3(Online)

Conference date: 6 August 2023

Editor：Canh Thien Dang

Series: Advances in Economics, Management and Political Sciences

Volume number: Vol.42

ISSN：2754-1169(Print) / 2754-1177(Online)

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