Abstract
Primary objective of this paper was to investigate the impact of information uncertainty and cognitive profile of investors on herding behavior. We analyzed the behavior of investors influenced by the decision of other investors due to the lack of information and cognitive profile of investors. Well designed experiments in three sessions are conducted for this study. These experiments were conducted in three stages to check the impact of different levels of information and conditions on the herding behavior. This study reflects that there is a positive relationship between the information uncertainty and the biases of investor's behavior and occurrence of herding. Studies also reveal that the previously existing financial information and previously shown behavior in the market also encourages the herding phenomenon prevailing in the market. Researches indicate that the change in the Cognitive profile of the investors is more significant due to the increase in the financial information and the historical record of the transaction. There is also a significant change in the biases of the investor due to the public information.
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