Abstract

ABSTRACT This study investigates the role of availability heuristics in retail investors' trading decisions. Results suggest momentum in trading activities as these seem to take increased positions in call and put options over time. Retail investors employ these heuristics as contrarian indicators while speculating in the options market. There is weak evidence of speculation and availability heuristics in the futures trading probably due to its unlimited potential losses and marked to market features. The simplicity provided by trendy trading, video apps and social media forums has converted investing into a game nudging small investors to take a bigger risk. Keywords Heuristics, Behavioral Finance, Options, Futures

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