Get 20M+ Full-Text Papers For Less Than $1.50/day. Start a 14-Day Trial for You or Your Team.

Learn More →

From stocks to ETFs: explaining retail investors' migration behavior

From stocks to ETFs: explaining retail investors' migration behavior Evidence suggests that retail investors who invest in individual stocks are, in the long run, largely outperformed by market indexes such as the MSCI World. While some turn to exchange traded funds (ETFs) to invest in such market indexes, few migrate completely to ETFs. This study aims to shed light on the rationale behind retail investors' partial and complete migration from stocks to ETFs.Design/methodology/approachDrawing from the pull-push-mooring framework, a qualitative study (N = 21) informs a quantitative study (N = 282) by following established mixed methods guidelines. This study develops propositions for partial and complete migration intention to ETFs.FindingsResults reveal that perceived investment possibilities, perceived risk reduction, perceived administrative effort, perceived expensiveness and monetary loss costs influence the migration from stocks to ETFs. This study shows that three configurations of perceptions result in partial migration intention and one configuration results in complete migration intention.Originality/valueThis study explains why some migrate partially from stocks to ETFs and others migrate completely. Findings show that both migration behaviors are subject to the same perceptions, but the configurations that form the behaviors are different. While only some identified perceptions must be present for a partial migration, all of them must be present for a complete migration, as it requires retail investors to sell their stocks and accept the costs incurred to invest in ETFs instead. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Internet Research Emerald Publishing

From stocks to ETFs: explaining retail investors' migration behavior

Meier, Marco; Maier, Christian
Internet Research , Volume 33 (4): 27 – Jul 17, 2023
Download PDF
27 pages

Loading next page...
 
/lp/emerald-publishing/from-stocks-to-etfs-explaining-retail-investors-migration-behavior-vvwfUZ9ceK

References (92)

Publisher
Emerald Publishing
Copyright
© Emerald Publishing Limited
ISSN
1066-2243
DOI
10.1108/intr-09-2021-0695
Publisher site
See Article on Publisher Site

Abstract

Evidence suggests that retail investors who invest in individual stocks are, in the long run, largely outperformed by market indexes such as the MSCI World. While some turn to exchange traded funds (ETFs) to invest in such market indexes, few migrate completely to ETFs. This study aims to shed light on the rationale behind retail investors' partial and complete migration from stocks to ETFs.Design/methodology/approachDrawing from the pull-push-mooring framework, a qualitative study (N = 21) informs a quantitative study (N = 282) by following established mixed methods guidelines. This study develops propositions for partial and complete migration intention to ETFs.FindingsResults reveal that perceived investment possibilities, perceived risk reduction, perceived administrative effort, perceived expensiveness and monetary loss costs influence the migration from stocks to ETFs. This study shows that three configurations of perceptions result in partial migration intention and one configuration results in complete migration intention.Originality/valueThis study explains why some migrate partially from stocks to ETFs and others migrate completely. Findings show that both migration behaviors are subject to the same perceptions, but the configurations that form the behaviors are different. While only some identified perceptions must be present for a partial migration, all of them must be present for a complete migration, as it requires retail investors to sell their stocks and accept the costs incurred to invest in ETFs instead.

Journal

Internet Research – Emerald Publishing

Published: Jul 17, 2023

Keywords: Pull-push-mooring framework; Migration behavior; Partial migration; Complete migration; Mixed methods study; Fuzzy set qualitative comparative analysis (fsQCA); Exchange traded funds (ETFs); Stocks; Investment

There are no references for this article.