Analyzing the influence of indexing strategies on investors’ behavior and asset pricing through agent-based modeling: Smart beta and financial markets

Research output: Chapter in Book/Report/Conference proceedingConference contribution

Abstract

This study analyzes the influence of indexing strategy on investors’ behavior and financial markets through agent-based modeling. In this analysis, I focus on smart beta index, which is proposed as a newstock index and condsidered to have better characteristics than traditional market capitalization-weighted indices. As a result of intensive computational simulation studies, we have concluded that a smart beta strategy is effective even in cases where the initial number of smart beta investors is small. This study also finds a significant relationship between the number of smart beta investors and trading volume. These results are significant from both practical and academic viewpoints.

Original languageEnglish
Title of host publicationAgent and Multi-Agent Systems: Technology and Applications - 10th KES International Conference, KES-AMSTA 2016, Proceedings
PublisherSpringer Science and Business Media Deutschland GmbH
Pages331-340
Number of pages10
Volume58
ISBN (Print)9783319398822
DOIs
Publication statusPublished - 2016
Event10th KES International Conference on Agent and Multi-Agent Systems: Technology and Applications, KES-AMSTA 2016 - Puerto de la Cruz, Tenerife, Spain
Duration: 2016 Jun 152016 Jun 17

Publication series

NameSmart Innovation, Systems and Technologies
Volume58
ISSN (Print)21903018
ISSN (Electronic)21903026

Other

Other10th KES International Conference on Agent and Multi-Agent Systems: Technology and Applications, KES-AMSTA 2016
Country/TerritorySpain
CityPuerto de la Cruz, Tenerife
Period16/6/1516/6/17

Keywords

  • Agent-based model
  • Asset management business
  • Financial markets
  • Smart beta
  • Stock indices

ASJC Scopus subject areas

  • Computer Science(all)
  • Decision Sciences(all)

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