The Effect of Instant Changes in Cyrpto Currency Market Investor Sentiment on Stock Markets
Chapter from the book:
Yılmaz,
E.
S.
(ed.)
2024.
Academic Research and Evaluations in the Field of Social Sciences-III.
Synopsis
Investors want to know the risks they will be exposed as well as the returns they will receive, when making investment decisions. For this reason, they try to identify factors that may cause changes in the price of the asset they will invest in and analyze the potential effects of these factors on their earnings. Stock investors also aim to identify factors that are likely to affect stock prices. Nowadays, there are many variables that may affect asset prices. These variables may be economic and financial based, as well as psychological factors such as investor sentiment and herd behavior. On the other hand, the relationships between markets that are alternatives to each other and have connections with each other should also be taken into account as important variables in investment decisions. In this context, the main purpose of the study is to analyze the effects that sudden changes in investor sentiment in the cryptocurrency market may have on stock markets. For this purpose, the crypto fear and greed index was used, and instant response series were derived by using wavelet transformation in order to determine the effects of sudden changes in sensitivity. In the following step, the effects of instant reaction series on the stock markets of 22 countries were analyzed using the Bootstrap Toda-Yamamoto Causality test. The analysis results revealed that the sudden reactions in the index created price changes in 8 of the stock markets and that these changes did not differ in developed and developing countries.
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This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License.
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Copyright (c) 2024 Emrah Sıtkı Yılmaz; Şahin Çaylı, Ebru Açık Turğuter, Ebrar Elveren, Selahattin Taylan, Salih Köseoğlu, Mehmet Yıldırım, Ayşe Yaşar Ümütlü, Turgay Toksoy, Özlem Balaban, Fazilet Nohut, Ahmet Küçük, Umut Turgut Yıldırım, Osman Ağır, Halil İbrahim Ada, Ezgi Tokdil, Erdoğan Keleş, Zeynep İskefiyeli, Fikrettin Yavuz, Berna İleri, Tuğba Konuk, Murat Nazlı, Bahar Moazami, Fatima Alwash, Mahmut Uçaktürk