Examining the investment decision-making process of retail investors based on Robinhood user data

Bibliographic Details
Main Author: Walz-Nickol, Philipp Marvin
Publication Date: 2023
Format: Master thesis
Language: eng
Source: Repositórios Científicos de Acesso Aberto de Portugal (RCAAP)
Download full: http://hdl.handle.net/10362/156043
Summary: This paper analyzes both the risk behavior and investment decision-making process of users of the retail brokerage platform Robinhood Markets, Inc., based on publicly available holdings data. I find that Robinhood users engage disproportionately in unusual stocks. Applying a mul tivariate OLS regression, one can see that they tend to overweight mediocrely reputable infor mation sources. Analyzing their consensus performance versus comparative portfolios, one can observe that the users cannot outperform less volatile benchmarks. Further, they take on unnec essary risk due to a lack of diversification and overweighting of particular securities, indicating that modern retail investors behave riskier than traditional individual investors.
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spelling Examining the investment decision-making process of retail investors based on Robinhood user dataFintechRetail investorsRobinhoodFinancial marketsDomínio/Área Científica::Ciências Sociais::Economia e GestãoThis paper analyzes both the risk behavior and investment decision-making process of users of the retail brokerage platform Robinhood Markets, Inc., based on publicly available holdings data. I find that Robinhood users engage disproportionately in unusual stocks. Applying a mul tivariate OLS regression, one can see that they tend to overweight mediocrely reputable infor mation sources. Analyzing their consensus performance versus comparative portfolios, one can observe that the users cannot outperform less volatile benchmarks. Further, they take on unnec essary risk due to a lack of diversification and overweighting of particular securities, indicating that modern retail investors behave riskier than traditional individual investors.d’Arienzo, DanieleRUNWalz-Nickol, Philipp Marvin2023-07-31T14:36:16Z2023-01-122023-01-122023-01-12T00:00:00Zinfo:eu-repo/semantics/publishedVersioninfo:eu-repo/semantics/masterThesisapplication/pdfhttp://hdl.handle.net/10362/156043TID:203312104enginfo:eu-repo/semantics/openAccessreponame:Repositórios Científicos de Acesso Aberto de Portugal (RCAAP)instname:FCCN, serviços digitais da FCT – Fundação para a Ciência e a Tecnologiainstacron:RCAAP2024-05-22T18:13:30Zoai:run.unl.pt:10362/156043Portal AgregadorONGhttps://www.rcaap.pt/oai/openaireinfo@rcaap.ptopendoar:https://opendoar.ac.uk/repository/71602025-05-28T17:43:57.852098Repositórios Científicos de Acesso Aberto de Portugal (RCAAP) - FCCN, serviços digitais da FCT – Fundação para a Ciência e a Tecnologiafalse
dc.title.none.fl_str_mv Examining the investment decision-making process of retail investors based on Robinhood user data
title Examining the investment decision-making process of retail investors based on Robinhood user data
spellingShingle Examining the investment decision-making process of retail investors based on Robinhood user data
Walz-Nickol, Philipp Marvin
Fintech
Retail investors
Robinhood
Financial markets
Domínio/Área Científica::Ciências Sociais::Economia e Gestão
title_short Examining the investment decision-making process of retail investors based on Robinhood user data
title_full Examining the investment decision-making process of retail investors based on Robinhood user data
title_fullStr Examining the investment decision-making process of retail investors based on Robinhood user data
title_full_unstemmed Examining the investment decision-making process of retail investors based on Robinhood user data
title_sort Examining the investment decision-making process of retail investors based on Robinhood user data
author Walz-Nickol, Philipp Marvin
author_facet Walz-Nickol, Philipp Marvin
author_role author
dc.contributor.none.fl_str_mv d’Arienzo, Daniele
RUN
dc.contributor.author.fl_str_mv Walz-Nickol, Philipp Marvin
dc.subject.por.fl_str_mv Fintech
Retail investors
Robinhood
Financial markets
Domínio/Área Científica::Ciências Sociais::Economia e Gestão
topic Fintech
Retail investors
Robinhood
Financial markets
Domínio/Área Científica::Ciências Sociais::Economia e Gestão
description This paper analyzes both the risk behavior and investment decision-making process of users of the retail brokerage platform Robinhood Markets, Inc., based on publicly available holdings data. I find that Robinhood users engage disproportionately in unusual stocks. Applying a mul tivariate OLS regression, one can see that they tend to overweight mediocrely reputable infor mation sources. Analyzing their consensus performance versus comparative portfolios, one can observe that the users cannot outperform less volatile benchmarks. Further, they take on unnec essary risk due to a lack of diversification and overweighting of particular securities, indicating that modern retail investors behave riskier than traditional individual investors.
publishDate 2023
dc.date.none.fl_str_mv 2023-07-31T14:36:16Z
2023-01-12
2023-01-12
2023-01-12T00:00:00Z
dc.type.status.fl_str_mv info:eu-repo/semantics/publishedVersion
dc.type.driver.fl_str_mv info:eu-repo/semantics/masterThesis
format masterThesis
status_str publishedVersion
dc.identifier.uri.fl_str_mv http://hdl.handle.net/10362/156043
TID:203312104
url http://hdl.handle.net/10362/156043
identifier_str_mv TID:203312104
dc.language.iso.fl_str_mv eng
language eng
dc.rights.driver.fl_str_mv info:eu-repo/semantics/openAccess
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instname:FCCN, serviços digitais da FCT – Fundação para a Ciência e a Tecnologia
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instname_str FCCN, serviços digitais da FCT – Fundação para a Ciência e a Tecnologia
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reponame_str Repositórios Científicos de Acesso Aberto de Portugal (RCAAP)
collection Repositórios Científicos de Acesso Aberto de Portugal (RCAAP)
repository.name.fl_str_mv Repositórios Científicos de Acesso Aberto de Portugal (RCAAP) - FCCN, serviços digitais da FCT – Fundação para a Ciência e a Tecnologia
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