Are Investors Confused by Stocks with Similar Company Names？(Huaguang v.s New Huaguang)

• Main Authors: Wan-Lin Yi, 易婉琳
• Other Authors: Pao-chung Hsu
• Format: Others
• Language: zh-TW
• Published: 2009
• Online Access: http://ndltd.ncl.edu.tw/handle/futx38

碩士 === 靜宜大學 === 財務金融研究所 === 97 === Recently, investors’ behavior related to the Behavioral Finance was introduced to detect the Representativeness Heuristic. The purpose of this paper is to examine whether the significantly positive correlation and the misunderstand of investor can be found by employing two companies which have similar names from china. I choose the daily volume and daily closing price of the Huaguang and New HuaGuang by the Datastream. The data period is from December 1, 2006 to June 30, 2008. I apply the concepts and methods of Rashes(2001) from Journal Finances to forecast the correlation of the stock of two similar company names from china. I find that the significantly positive correlation exists continually for a period. And this paper indicates that investors can not arbitrage in the market. This provides market an alternative to understand the importance of investor''s behavior. The managers can use this character that the investors have been influenced by the corporate name when the managers make name for company or change the name.