Title: Individual investor behaviour: evidence from the clients of a small credit cooperative bank

Authors: Enrico Maria Cervellati; Pino Fattori; Pierpaolo Pattitoni

Addresses: Department of Management, University of Bologna, Via Capo di Lucca, 34 – 40126 Bologna, Italy; Luiss Guido Carli, Rome, Italy. ' Banca di Credito Cooperativo Gatteo, Via della Cooperazione, 10 – 47043, Gatteo, Italy. ' Department of Management, University of Bologna, Via Capo di Lucca, 34 – 40126, Bologna, Italy; The Rimini Centre for Economic Analysis (RCEA), Rimini, Italy

Abstract: Individual characteristics are important in explaining investor trading behaviour. The clients of a small cooperative bank are analysed over the three-year period 2005-2007 to measure the effect that age, gender, income, job position and status of online trader has on the number of stock trades completed. A negative binomial regression is used since our dependent variable, the number of trades, can only assume non-negative discrete values. This paper shows that the number of transactions increases if the client is: man vs. women; self-employed vs. employee, retiree or housewife; online vs. traditional trader; higher vs. low income. Our findings are not clear cut with respect to age. In conclusion, individual characteristics are important in explaining an individual's trading behaviour since they affect an investor's attitude towards risk and overconfidence.

Keywords: behavioural finance; overconfidence; overtrading; individual investors; investor characteristics; credit cooperative banks; investor behaviour; age; gender; income; job position; status; online traders; risk.

DOI: 10.1504/IJBAF.2011.045012

International Journal of Behavioural Accounting and Finance, 2011 Vol.2 No.3/4, pp.191 - 207

Published online: 20 Jan 2012 *

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