Blaming or praising passive ETFs?
(2021) , 31 pages
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- Authors
- Abstract
- We use random matching to study the trading behaviors of retail investors who hold passive exchange traded funds invested in stocks (P-ETFs). Using both trading records and survey data to control for all the key investor characteristics, we find strong evidence that retail investors trade differently when they hold P-ETFs. They have a higher portfolio size, a lower turnover, and keep their assets for a longer period of time than the control group of retail investors who hold individual stocks only. P-ETF retail investors are also better protected against stock gambling and those among them who follow a core-satellite approach are least likely to hold lottery-like stocks.
- Affiliations
Citations
D’Hondt, C., El Hichou El Maya, Y., & Petitjean, M. (2021). Blaming or praising passive ETFs? (LIDAM Discussion Paper LFIN 2021/08). https://hdl.handle.net/2078.5/107586