IDEAS home Printed from https://ideas.repec.org/a/eee/beexfi/v37y2023ics221463502200096x.html
   My bibliography  Save this article

A bibliometric analysis of the disposition effect: Origins and future research avenues

Author

Listed:
  • Gutiérrez-Nieto, Begoña
  • Ortiz, Cristina
  • Vicente, Luis

Abstract

This paper develops a comprehensive bibliometric analysis of a well-known bias in behavioral finance: the disposition effect. Since the term was coined in 1985, the tendency for investors to sell winners too soon and hold losers in the portfolio has been amply studied. Based on data from Web of Science and the tool VOSviewer, we obtain a complete picture of the evolution of the research on the disposition effect from citation and co-citation perspectives. The research topic has intensely increased the number of publications during the last years, and we also analyze the evolution of the lines of research. The analysis includes the yearly impact factors of the journals analyzed to ensure that the quality of publications remains. A temporal overlay visualization map shows the most used terms through time to explore future venues; disposition effect seems to be less studied alone, whereas researchers try to find interrelations with other behavioral biases.

Suggested Citation

  • Gutiérrez-Nieto, Begoña & Ortiz, Cristina & Vicente, Luis, 2023. "A bibliometric analysis of the disposition effect: Origins and future research avenues," Journal of Behavioral and Experimental Finance, Elsevier, vol. 37(C).
    • Handle: RePEc:eee:beexfi:v:37:y:2023:i:c:s221463502200096x
    DOI: 10.1016/j.jbef.2022.100774
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S221463502200096X
    Download Restriction: no
    File URL: https://libkey.io/10.1016/j.jbef.2022.100774?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Nees Jan Eck & Ludo Waltman, 2017. "Citation-based clustering of publications using CitNetExplorer and VOSviewer," Scientometrics, Springer;Akadémiai Kiadó, vol. 111(2), pages 1053-1070, May.
    2. Breitmayer, Bastian & Hasso, Tim & Pelster, Matthias, 2019. "Culture and the disposition effect," Economics Letters, Elsevier, vol. 184(C).
    3. David E. Bell, 1982. "Regret in Decision Making under Uncertainty," Operations Research, INFORMS, vol. 30(5), pages 961-981, October.
    4. Choijil, Enkhbayar & Méndez, Christian Espinosa & Wong, Wing-Keung & Vieito, João Paulo & Batmunkh, Munkh-Ulzii, 2022. "Thirty years of herd behavior in financial markets: A bibliometric analysis," Research in International Business and Finance, Elsevier, vol. 59(C).
    5. O’Connell, Paul G. J. & Teo, Melvyn, 2009. "Institutional Investors, Past Performance, and Dynamic Loss Aversion," Journal of Financial and Quantitative Analysis, Cambridge University Press, vol. 44(1), pages 155-188, February.
    6. Locke, Peter R. & Mann, Steven C., 2005. "Professional trader discipline and trade disposition," Journal of Financial Economics, Elsevier, vol. 76(2), pages 401-444, May.
    7. Amit Seru & Tyler Shumway & Noah Stoffman, 2010. "Learning by Trading," The Review of Financial Studies, Society for Financial Studies, vol. 23(2), pages 705-739, February.
    8. Rau, Holger A., 2015. "The disposition effect in team investment decisions: Experimental evidence," University of Göttingen Working Papers in Economics 256, University of Goettingen, Department of Economics.
    9. Andreu, Laura & Ortiz, Cristina & Sarto, José Luis, 2020. "Disposition effect in fund managers. Fund and stock-specific factors and the upshot for investors," Journal of Economic Behavior & Organization, Elsevier, vol. 176(C), pages 253-268.
    10. Da Costa, Newton & Goulart, Marco & Cupertino, Cesar & Macedo, Jurandir & Da Silva, Sergio, 2013. "The disposition effect and investor experience," Journal of Banking & Finance, Elsevier, vol. 37(5), pages 1669-1675.
    11. Andreassen, Paul B., 1988. "Explaining the price-volume relationship: The difference between price changes and changing prices," Organizational Behavior and Human Decision Processes, Elsevier, vol. 41(3), pages 371-389, June.
    12. Weishu Liu, 2019. "The data source of this study is Web of Science Core Collection? Not enough," Scientometrics, Springer;Akadémiai Kiadó, vol. 121(3), pages 1815-1824, December.
    13. Éric Archambault & Étienne Vignola-Gagné & Grégoire Côté & Vincent Larivière & Yves Gingrasb, 2006. "Benchmarking scientific output in the social sciences and humanities: The limits of existing databases," Scientometrics, Springer;Akadémiai Kiadó, vol. 68(3), pages 329-342, September.
    14. Thaler, Richard H & Shefrin, H M, 1981. "An Economic Theory of Self-Control," Journal of Political Economy, University of Chicago Press, vol. 89(2), pages 392-406, April.
    15. William N. Goetzmann & Alok Kumar, 2008. "Equity Portfolio Diversification," Review of Finance, European Finance Association, vol. 12(3), pages 433-463.
    16. Duxbury, Darren & Hudson, Robert & Keasey, Kevin & Yang, Zhishu & Yao, Songyao, 2015. "Do the disposition and house money effects coexist? A reconciliation of two behavioral biases using individual investor-level data," Journal of International Financial Markets, Institutions and Money, Elsevier, vol. 34(C), pages 55-68.
    17. Rau, Holger A., 2015. "The disposition effect in team investment decisions: Experimental evidence," Journal of Banking & Finance, Elsevier, vol. 61(C), pages 272-282.
    18. Daniel Kahneman & Amos Tversky, 2013. "Prospect Theory: An Analysis of Decision Under Risk," World Scientific Book Chapters, in: Leonard C MacLean & William T Ziemba (ed.), HANDBOOK OF THE FUNDAMENTALS OF FINANCIAL DECISION MAKING Part I, chapter 6, pages 99-127, World Scientific Publishing Co. Pte. Ltd..
    19. Cici, Gjergji, 2012. "The Prevalence of the Disposition Effect in Mutual Funds’ Trades," Journal of Financial and Quantitative Analysis, Cambridge University Press, vol. 47(4), pages 795-820, August.
    20. Brad M. Barber & Yi‐Tsung Lee & Yu‐Jane Liu & Terrance Odean, 2007. "Is the Aggregate Investor Reluctant to Realise Losses? Evidence from Taiwan," European Financial Management, European Financial Management Association, vol. 13(3), pages 423-447, June.
    21. Newton Da Costa & Carlos Mineto & Sergio Da Silva, 2008. "Disposition effect and gender," Applied Economics Letters, Taylor & Francis Journals, vol. 15(6), pages 411-416.
    22. Grinblatt, Mark & Keloharju, Matti & Linnainmaa, Juhani T., 2012. "IQ, trading behavior, and performance," Journal of Financial Economics, Elsevier, vol. 104(2), pages 339-362.
    23. Cary Frydman & Nicholas Barberis & Colin Camerer & Peter Bossaerts & Antonio Rangel, 2014. "Using Neural Data to Test a Theory of Investor Behavior: An Application to Realization Utility," Journal of Finance, American Finance Association, vol. 69(2), pages 907-946, April.
    24. Lei Feng & Mark Seasholes, 2005. "Do Investor Sophistication and Trading Experience Eliminate Behavioral Biases in Financial Markets?," Review of Finance, Springer, vol. 9(3), pages 305-351, September.
    25. Kaustia, Markku, 2010. "Prospect Theory and the Disposition Effect," Journal of Financial and Quantitative Analysis, Cambridge University Press, vol. 45(3), pages 791-812, June.
    26. Rawley Heimer, 2016. "Peer Pressure: Social Interaction and the Disposition Effect," Working Papers (Old Series) 1618, Federal Reserve Bank of Cleveland.
    27. Loomes, Graham & Sugden, Robert, 1982. "Regret Theory: An Alternative Theory of Rational Choice under Uncertainty," Economic Journal, Royal Economic Society, vol. 92(368), pages 805-824, December.
    28. Jacopo Magnani, 2015. "Testing for the Disposition Effect on Optimal Stopping Decisions," American Economic Review, American Economic Association, vol. 105(5), pages 371-375, May.
    29. Henry Small, 1973. "Co‐citation in the scientific literature: A new measure of the relationship between two documents," Journal of the American Society for Information Science, Association for Information Science & Technology, vol. 24(4), pages 265-269, July.
    30. Nees Jan Eck & Ludo Waltman, 2010. "Software survey: VOSviewer, a computer program for bibliometric mapping," Scientometrics, Springer;Akadémiai Kiadó, vol. 84(2), pages 523-538, August.
    31. Yu-En Lin & Hsiang-Hsuan Chih & Tai-Hsun Huang & Chia-Hsien Tang, 2015. "The Disposition Effect, Escalation Of Commitment And Herding Behavior Of Mutual Fund Managers," Annals of Financial Economics (AFE), World Scientific Publishing Co. Pte. Ltd., vol. 10(01), pages 1-23.
    32. Richard H. Thaler, 2008. "Mental Accounting and Consumer Choice," Marketing Science, INFORMS, vol. 27(1), pages 15-25, 01-02.
    33. Barberis, Nicholas & Xiong, Wei, 2012. "Realization utility," Journal of Financial Economics, Elsevier, vol. 104(2), pages 251-271.
    34. Andrea Frazzini, 2006. "The Disposition Effect and Underreaction to News," Journal of Finance, American Finance Association, vol. 61(4), pages 2017-2046, August.
    35. Shapira, Zur & Venezia, Itzhak, 2001. "Patterns of behavior of professionally managed and independent investors," Journal of Banking & Finance, Elsevier, vol. 25(8), pages 1573-1587, August.
    36. Vanessa Martins Valcanover & Igor Bernardi Sonza & Wesley Vieira da Silva, 2020. "Behavioral Finance Experiments: A Recent Systematic Literature Review," SAGE Open, , vol. 10(4), pages 21582440209, November.
    37. David Cesarini & Magnus Johannesson & Patrik K. E. Magnusson & Björn Wallace, 2012. "The Behavioral Genetics of Behavioral Anomalies," Management Science, INFORMS, vol. 58(1), pages 21-34, January.
    38. Shefrin, Hersh & Statman, Meir, 1985. "The Disposition to Sell Winners Too Early and Ride Losers Too Long: Theory and Evidence," Journal of Finance, American Finance Association, vol. 40(3), pages 777-790, July.
    39. Cronqvist, Henrik & Siegel, Stephan, 2014. "The genetics of investment biases," Journal of Financial Economics, Elsevier, vol. 113(2), pages 215-234.
    40. Weber, Martin & Camerer, Colin F., 1998. "The disposition effect in securities trading: an experimental analysis," Journal of Economic Behavior & Organization, Elsevier, vol. 33(2), pages 167-184, January.
    41. Simarjeet Singh & Nidhi Walia, 2022. "Momentum investing: a systematic literature review and bibliometric analysis," Management Review Quarterly, Springer, vol. 72(1), pages 87-113, February.
    42. Bastian Breitmayer & Tim Hasso & Matthias Pelster, 2019. "Culture and the disposition effect," Papers 1908.11492, arXiv.org.
    43. Rau, Holger A., 2014. "The disposition effect and loss aversion: Do gender differences matter?," Economics Letters, Elsevier, vol. 123(1), pages 33-36.
    44. Grinblatt, Mark & Keloharju, Matti, 2000. "The investment behavior and performance of various investor types: a study of Finland's unique data set," Journal of Financial Economics, Elsevier, vol. 55(1), pages 43-67, January.
    45. Grinblatt, Mark & Han, Bing, 2005. "Prospect theory, mental accounting, and momentum," Journal of Financial Economics, Elsevier, vol. 78(2), pages 311-339, November.
    46. Chou, Robin K. & Wang, Yun-Yi, 2011. "A test of the different implications of the overconfidence and disposition hypotheses," Journal of Banking & Finance, Elsevier, vol. 35(8), pages 2037-2046, August.
    47. Thaler, Richard, 1980. "Toward a positive theory of consumer choice," Journal of Economic Behavior & Organization, Elsevier, vol. 1(1), pages 39-60, March.
    48. repec:bla:jfinan:v:53:y:1998:i:5:p:1775-1798 is not listed on IDEAS
    49. Lei Feng & Mark S. Seasholes, 2005. "Do Investor Sophistication and Trading Experience Eliminate Behavioral Biases in Financial Markets?," Review of Finance, European Finance Association, vol. 9(3), pages 305-351.
    50. Jen-Sin Lee & Pi-Hsia Yen & Kam C. Chan, 2013. "Market states and disposition effect: evidence from Taiwan mutual fund investors," Applied Economics, Taylor & Francis Journals, vol. 45(10), pages 1331-1342, April.
    51. Tarvo Vaarmets & Kristjan Liivamägi & Tõnn Talpsepp, 2019. "How Does Learning and Education Help to Overcome the Disposition Effect?," Review of Finance, European Finance Association, vol. 23(4), pages 801-830.
    52. Cueva, Carlos & Iturbe-Ormaetxe, Iñigo & Ponti, Giovanni & Tomás, Josefa, 2019. "An experimental analysis of the disposition effect: Who and when?," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 81(C), pages 207-215.
    53. Rawley Z. Heimer, 2016. "Peer Pressure: Social Interaction and the Disposition Effect," The Review of Financial Studies, Society for Financial Studies, vol. 29(11), pages 3177-3209.
    54. Liêu, L.M. & Pelster, M., 2020. "Framing and the disposition effect in a scopic regime," The Quarterly Review of Economics and Finance, Elsevier, vol. 78(C), pages 175-185.
    55. Xianwen Wang & Zhichao Fang & Xiaoling Sun, 2016. "Usage patterns of scholarly articles on Web of Science: a study on Web of Science usage count," Scientometrics, Springer;Akadémiai Kiadó, vol. 109(2), pages 917-926, November.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Zhang, Xiaotao & Wang, Ziqiao & Hao, Jing & Liu, Jiubiao, 2022. "Stock market entry timing and retail investors' disposition effect," International Review of Financial Analysis, Elsevier, vol. 82(C).
    2. Marco Pleßner, 2017. "The disposition effect: a survey," Management Review Quarterly, Springer, vol. 67(1), pages 1-30, February.
    3. Hermann, Daniel & Mußhoff, Oliver & Rau, Holger A., 2019. "The disposition effect when deciding on behalf of others," Journal of Economic Psychology, Elsevier, vol. 74(C).
    4. Dorn, Daniel & Strobl, Günter, 2023. "Rational disposition effects: Theory and evidence," Journal of Banking & Finance, Elsevier, vol. 153(C).
    5. Hincapié-Salazar, Juliana & Agudelo, Diego A., 2020. "Is the disposition effect in bonds as strong as in stocks? Evidence from an emerging market," Global Finance Journal, Elsevier, vol. 46(C).
    6. Liêu, L.M. & Pelster, M., 2020. "Framing and the disposition effect in a scopic regime," The Quarterly Review of Economics and Finance, Elsevier, vol. 78(C), pages 175-185.
    7. Barber, Brad M. & Odean, Terrance, 2013. "The Behavior of Individual Investors," Handbook of the Economics of Finance, in: G.M. Constantinides & M. Harris & R. M. Stulz (ed.), Handbook of the Economics of Finance, volume 2, chapter 0, pages 1533-1570, Elsevier.
    8. Sarmiento, Julio & Rendón, Jairo & Sandoval, Juan S. & Cayon, Edgardo, 2019. "The disposition effect and the relevance of the reference period: Evidence among sophisticated investors," Journal of Behavioral and Experimental Finance, Elsevier, vol. 24(C).
    9. Choi, Darwin, 2019. "Disposition sales and stock market liquidity," Journal of Financial Markets, Elsevier, vol. 45(C), pages 19-36.
    10. De Winne, Rudy, 2021. "Measuring the disposition effect," Journal of Behavioral and Experimental Finance, Elsevier, vol. 29(C).
    11. Bouteska, Ahmed & Kabir Hassan, M. & Gider, Zeynullah & Bataineh, Hassan, 2024. "The role of investor sentiment and market belief in forecasting V-shaped disposition effect: Evidence from a Bayesian learning process with DSSW model," The North American Journal of Economics and Finance, Elsevier, vol. 71(C).
    12. Andreu, Laura & Ortiz, Cristina & Sarto, José Luis, 2020. "Disposition effect in fund managers. Fund and stock-specific factors and the upshot for investors," Journal of Economic Behavior & Organization, Elsevier, vol. 176(C), pages 253-268.
    13. Li, Jianbiao & Niu, Xiaofei & Li, Dahui & Cao, Qian, 2018. "Using Non-Invasive Brain Stimulation to Test the Role of Self-Control in Investor Behavior," EconStor Preprints 177890, ZBW - Leibniz Information Centre for Economics.
    14. Pelster, Matthias & Hofmann, Annette, 2018. "About the fear of reputational loss: Social trading and the disposition effect," Journal of Banking & Finance, Elsevier, vol. 94(C), pages 75-88.
    15. Niu, Xiaofei & Li, Jianbiao, 2019. "How Time Constraint Affects the Disposition Effect?," EconStor Preprints 194618, ZBW - Leibniz Information Centre for Economics.
    16. Deaves, Richard & Kluger, Brian & Miele, Jennifer, 2018. "An exploratory experimental analysis of path-dependent investment behaviors," Journal of Economic Psychology, Elsevier, vol. 67(C), pages 47-65.
    17. Jakusch, Sven Thorsten & Meyer, Steffen & Hackethal, Andreas, 2019. "Taming models of prospect theory in the wild? Estimation of Vlcek and Hens (2011)," SAFE Working Paper Series 146, Leibniz Institute for Financial Research SAFE, revised 2019.
    18. Janssen, Dirk-Jan & Li, Jiangyan & Qiu, Jianying & Weitzel, Utz, 2020. "The disposition effect and underreaction to private information," Journal of Economic Dynamics and Control, Elsevier, vol. 113(C).
    19. Li, Yan & Yang, Liyan, 2013. "Prospect theory, the disposition effect, and asset prices," Journal of Financial Economics, Elsevier, vol. 107(3), pages 715-739.
    20. Stephen L Cheung, 2024. "A meta-analysis of disposition effect experiments," Working Papers 2024-02, University of Sydney, School of Economics.

    More about this item

    Keywords

    Disposition effect; Behavioral finance; Literature review; Bibliometrics; Scientometrics;
    All these keywords.

    JEL classification:

    • G11 - Financial Economics - - General Financial Markets - - - Portfolio Choice; Investment Decisions
    • G40 - Financial Economics - - Behavioral Finance - - - General
    • G41 - Financial Economics - - Behavioral Finance - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making in Financial Markets

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:beexfi:v:37:y:2023:i:c:s221463502200096x. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: https://www.journals.elsevier.com/journal-of-behavioral-and-experimental-finance .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.