We show that stock prices underreact when there is a political event, reflected in higher momentum returns. We conjecture that political news crowds out stock news cause investors to distract, trade more indexes and underreact to firm specific news. We analyze momentum returns following general...

This paper presents steps to lower the overall volatility in the stock market; as a large portion is unrewarded and unjustified and driven by overreaction accompanies with herd behavior. We first map the key factors that cause volatility, such as: earnings surprise, CEO turnovers, merge and...

This paper demonstrates a strong inverse connection between daily stock returns and Congress in session. Our key conjecture is when Congress is in session, more media attention focuses on congressional activity than on the stock market; the more the news attention is political, the lower the...

This paper examines whether politically active individuals are more likely to participate in the stock market. Our key conjecture is that politically involved individuals follow political news more actively, which increases their chances of being exposed to financial news. Consequently, their...

This paper shows that household’s saving motives influence key portfolio choice decision: stock market participation. We utilize a unique data set from the Survey of Consumer Finance (2019 and panel 2007-209), which report about 24 reasons for saving and group these intro 6 saving motive...

We show that the stock market pricing the presidential margin of victory in a nonlinear concave fashion, with a higher price for medium than slight or crushing victories. We conjecture that the margin of victory reflects president confidence and the ability to execute policies. A small margin...

Political science theories suggest that U.S. presidents' tenures in office share distinct phases, which have systematic characteristics, that span party ideologies. However, limited attention has been paid to the relation between the presidential life cycle and financial markets. We document...

We use the VIX and basic trading behavior to time entry and exit from the market. Our strategy captures 89% of the bottom and 91% from the top (you miss only 11% and 9% from the peak point, respectively). We lay our strategy down in six acts. Act I: the daily average return in the stock market...

This paper compares the stock market (S&P) performance during presidents Trump and Obama. The comparison is interesting since Obama employed a stimulus plan (demand side) while Trump employed a tax cut (supply side). We use the inauguration date as the benchmark start till analyses day 7/7/2019;...

This paper examines whether political activism increases people's propensity to participate in the stock market. Our key conjecture is that politically active people follow political news more actively, which increases their chance of being exposed to financial news. Consequently, their...