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Retail investors’ cryptocurrency investments

Pursiainen, Vesa; Toczynski, Jan (2022). Retail investors’ cryptocurrency investments. Swiss Finance Institute Research Paper 23-51, Swiss Finance Institute.

Abstract

We use transaction data gathered by a large fintech firm to study retail investors’ investments in cryptocurrencies. Crypto investors tend to be young, male, high-income, and live in wealthy urban areas with high levels of self-employment and low levels of altruism. Crypto investments are positively associated with stock investments and the use of robo-investing apps, as well as with gambling and the use of round numbers. Net flows into cryptocurrencies are negatively correlated with short-term past returns but positively with longer-term ones. Historical high and low price points also seem to matter. Personal initial experiences of crypto returns at adoption affect subsequent crypto investments. Investors exhibit little market timing ability, but controlling for the time of entry, women do better and stock investors worse.

Additional indexing

Item Type:Working Paper
Communities & Collections:03 Faculty of Economics > Department of Finance
Dewey Decimal Classification:330 Economics
JEL Classification:G11, G23, G42, G51
Uncontrolled Keywords:Cryptocurrency, retail investors, fintech, market timing
Scope:Discipline-based scholarship (basic research)
Language:English
Date:December 2022
Deposited On:07 Sep 2023 14:49
Last Modified:27 May 2024 15:23
Series Name:Swiss Finance Institute Research Paper
Number of Pages:40
ISSN:1556-5068
OA Status:Closed
Publisher DOI:https://doi.org/10.2139/ssrn.4268236
Official URL:https://www.sfi.ch/en/publications/n-23-51-retail-investors-cryptocurrency-investments
Other Identification Number:merlin-id:23534

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