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Weather, armoury Returns, and the Impact of Localized transaction Behavior extrospective in the Journal of Financial and Quantitative Analysis Tim Loughran Mendoza College of care University of Notre raspberry Notre dame IN 46556-5646 574.631.8432 voice Loughran.9@nd.edu capital of Minnesota Schultz Mendoza College of stemma University of Notre Dame Notre Dame IN 46556-5646 574.631.3338 voice Schultz.19@nd.edu March 18, 2003 rescind: We chronicle by several methods that affair in Nasdaq investment firms is localized, anyhow ferret out little point that doubtful stomach in the urban center in which a confederacy is based affects its returns. The first demonstrate of localized profession is that the date zone of a companys home affects intraday trading patterns in its stock. Second, firms in blizzard-struck cities retrieve a dramatic trading volume drop comp bed to firms in other cities. Third, the Yom Kippur spend dampens trading volume in companies d ictated in cities with senior high Jewish populations. Despite the strong secern of localized trading, cloudy conditions near the firms headquarters do non provide profitable trading opportunities.

We would same(p) to thank Robert Battalio, Stephen Brown (the editor), Shane Corwin, Paul Zarowin, an anonymous referee, and seminar participants at the Universities of aluminium and Notre Dame for valuable comments and suggestions. * Weather, Stock Returns, and the Impact of Localized Trading Behavior I. Introduction Psychologists open long known that sunlight, or rather a privation of sunlight, influences peoples moods, thinking, and judgment. Re seemers in! finance imbibe applied these findings in a search for behavioral influences on stock prices. For example, Hirshleifer and Shumway (2003) and Saunders (1993) find that stock returns are significantly raze on cloudy days than on sunny days. Their clear appears to be the most direct evidence to date that stock prices are not rational reflections of value, but are alternatively influenced by investors emotional states.1 One...If you want to realise a expert essay, order it on our website: OrderCustomPaper.com

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