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Will stock rise on Valentine’s Day?

Author

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  • Terence Tai-Leung Chong
  • Siqi Hou

Abstract

Purpose - This study is a pioneer in the academic literature to investigate the relationship between Valentine’s Day and stock market returns of major economies around the world. Design/methodology/approach - Specific control variables for Valentine's Day are introduced to eliminate the potential influence of other effects. Findings - The findings indicate that stock returns are higher on the days when Valentine's Day is approaching than on other days for most cases, showing “the Valentine Effect” in the stock market. Originality/value - Unlike other holiday effects in the previous literature, the Valentine's Day effect cannot be explained by many conventional theories, such as tax-loss selling and the inventory adjustment hypothesis.

Suggested Citation

  • Terence Tai-Leung Chong & Siqi Hou, 2021. "Will stock rise on Valentine’s Day?," Review of Behavioral Finance, Emerald Group Publishing Limited, vol. 14(5), pages 646-667, May.
    • Handle: RePEc:eme:rbfpps:rbf-02-2021-0015
    DOI: 10.1108/RBF-02-2021-0015
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    More about this item

    Keywords

    Valentine's effect; Tax-loss selling hypothesis; Inventory adjustment hypothesis; Affect infusion model; G14; G41;
    All these keywords.

    JEL classification:

    • G1 - Financial Economics - - General Financial Markets
    • G14 - Financial Economics - - General Financial Markets - - - Information and Market Efficiency; Event Studies; Insider Trading

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