Investor Behavior and Flow-through Capability in the US Stock Market

This paper analyzes investor behavior depending on the flow-through capability (FTC) in the US stock market, because investors seek protection from inflation rate changes, and the FTC (a firm's ability to transmit inflation shocks to the prices of its products and services) is a key factor in i...

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Detalles Bibliográficos
Autores principales: Cano, Carlos, Jareño, Francisco, Tolentino, Marta
Formato: Online Artículo Texto
Lenguaje:English
Publicado: Frontiers Media S.A. 2016
Materias:
Psychology
Acceso en línea:https://www.ncbi.nlm.nih.gov/pmc/articles/PMC4860425/
https://www.ncbi.nlm.nih.gov/pubmed/27242585
http://dx.doi.org/10.3389/fpsyg.2016.00668
Descripción
Sumario:This paper analyzes investor behavior depending on the flow-through capability (FTC) in the US stock market, because investors seek protection from inflation rate changes, and the FTC (a firm's ability to transmit inflation shocks to the prices of its products and services) is a key factor in investment decisions. Our estimates of the FTC of firms listed on the US stock exchange at the sector level are significantly different among industries, and we demonstrate a direct relationship between changes in stock prices (at the sector level) and FTC. These results would be relevant because they have important implications on investor behavior.

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