City Research Online

Abstract

This paper studies herding and anti‐herding behaviour in three European stock markets before and during the Covid‐19 pandemic by employing both static and dynamic analysis. We examine four different questions related to herding behaviour: (i) Did herding behaviour increase during the pandemic? (ii) Does herding behaviour respond differently in up and down market conditions? (iii) Is herding behaviour related to the volume of trading activity? and (iv) Does herding behaviour increase in periods of high market volatility? We find that, contrary to much of the existing literature, there is very little evidence of herding activity, and if anything, we find the evidence points to anti‐herding behaviour during the Covid‐19 pandemic.

Publication Type:	Article
Additional Information:	© 2025 The Author(s). International Journal of Finance & Economics published by John Wiley & Sons Ltd. This is an open access article under the terms of the Creative Commons Attribution License, which permits use, distribution and reproduction in any medium, provided the original work is properly cited.
Publisher Keywords:	behavioural finance, Covid-19, cross-sectional dispersion of returns, European stock markets, herding behaviour
Subjects:	H Social Sciences > HB Economic Theory
Departments:	School of Policy & Global Affairs School of Policy & Global Affairs > Economics
SWORD Depositor:	Symplectic Administrator

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