Title: Speculative trading and stock prices
First published: 2005
Description: "The market dynamics of technology stocks in the late nineties has stimulated a growing body of theories that analyze the joint effects of short-sales constraints and heterogeneous beliefs on stock prices and trading volume.  This paper examines implications of these theories using a unique data sample from China, a market with stringent short-sales constraints and perfectly segmented dual-class shares.  The identical rights of the dual-class shares allow us to control for stock fundamentals.  We find that trading caused by investors' speculative motive can help explain a significant fraction of the price difference between the dual-class shares"--National Bureau of Economic Research web site.
Subjects: Stocks, Prices, Speculation, Econometric models
Places: China
LC classification: HB1