ANALYSIS OF INVESTORS^ OVERCONFIDENCE BIAS IMPACT IN THE COVID 19 PANDEMIC: A STUDY ON THE LQ45 INDEX
Leni Yuliyanti, Nugraha

Universitas Pendidikan Indonesia

Abstract

The purpose of this study is to determine the impact of overconfidence bias on investor behavior on the Indonesia Stock Exchange during the COVID-19 pandemic in the short and long term. The research method used is quantitative method using VECM regression analysis. The population in this study are 45 companies that are included in LQ45 in 2019-2020. The sample used in this study is 34 companies with purposive sampling technique applied. The data used is secondary data of 124 observation data, namely data on volatility, return and stock trading volume with weekly frequency. The results of this study indicate that overconfidence bias can affect investor behavior and have an impact on investment performance. In the long term overconfidence bias can affect stock returns, while in the short term it only affects stock volatility.

Keywords: overconvidence bias, stock returns, volatility, trading volume

Topic: Financial Management and Accounting