Year of Graduation
Investor Overconfidence Bias at the Russian Market
Strategic Corporate Finance
The research in this work tests the existence of the overconfidence bias in the Russian market. The overconfidence bias is considered to be overreaction of stock price to non-financial news that are more subjective and underreaction to financial news as more objective. The data set includes 5 362 news during 2010-2014 of the 11 largest non-financial companies from MICEX index that are quoted at the Moscow Stock Exchange. The financial and non-financial news were sorted to three types of reaction they give to stock prices: overreaction, underreaction and reversal. The results received show that the stock price reaction to financial and non-financial information during the studied period is absolutely the same (with underreaction prevalence) for the companies in the range and, consequently, the overconfidence bias hypothesis is rejected.