Herding Behavior in Pakistani Financial Markets: A Study of Behavioral Finance

Imran Bashir Dar; Nida Baig; Muhammad Usman; Shahbaz Khan; Zeeshan Ahmed

Abstract:

This paper examines herd behavior in Pakistan stock market using data from the Pakistan Stock Exchange. We test for the presence of herding as suggested by Hwang and Salmon (2004) Model. Results based on monthly data indicate the existence of herd behavior for the years 2013-2018. Evidence of little herd behavior is found during the whole period except in the last months of December, 2012 where more herding practices are being observed in Pakistan Stock Exchange. While investigating the herd behavior using sector wise data, we found that cement industry shows more herding as compared to others sectors.

research from:

• Foundation University - Faculty of Management Sciences

Year:

2019

Type of Publication:

Article

Journal:

Foundation University Journal of Business & Economics

Volume:

4

Number:

2

Pages:

11-18

Month:

8