The Pursuit of Wealth Versus Thrill-Seeking : A Study on the Motivation Behind Stock Investors’ Gambling Psychology

This paper uses the lottery search index to measure public gambling sentiment, and exams the impact of temporal changes in gambling sentiment on trading behaviour, liquidity and yield of lottery stocks. We show that investors view lottery tickets and lottery stocks as alternative investments, trading them for gaining wealth rather than seeking thrills. When gaming sentiment is high, investors tend to actively sell lottery stocks in order to increase the purchase of lottery, which would increase short-term order imbalances and market liquidity, and reduce abnormal returns for lottery stocks. Our findings highlight yet another possible cause of investors’ gambling psychology