The effect of Chinese lunar calendar on individual investors' trading

We examine whether individual investors pay more attention to the stock market on auspicious days. We define an auspicious day as being on the Chinese lunar calendar, which is the common social norm in Chinese society. This norm is reflected in (i) more extensive and (ii) less profitable trading. Furthermore, this effect is heightened in cities with more elderly, more temples of the Wealth God, and more gambling sentiment. Individual investors' preferences for lottery-like and preferred stocks are essential mechanisms to explain our findings. We provide a first understanding of the effect of a social norm on individual investors' trading behavior.