{"id":{"repo_id":"cape-town","oai_identifier":"oai:open.uct.ac.za:11427/5884"},"canonical_url":"https://search.dev.ndltd.org/etd/cape-town/oai:open.uct.ac.za:11427/5884","repository":{"repo_id":"cape-town","name":"University of Cape Town","base_url":"https://open.uct.ac.za/oai/request"},"display":{"title":"Examining the presence of anchoring and adjustment in stock market investment decisions by Stefan Els.","abstract":"With three major stock market crashes in less than two decades, understanding the forces at work in the modern stock market is more important than ever before. The anchoring and adjustment heuristic has often been described as one of the psychological forces influencing investment decisions but little research has been done to support this belief. The aim of the present dissertation is to empirically study the presence of anchoring and adjustment in stock market decisions. To do this, a small group of equity analysts from South African investment firms were used for a pilot study before a survey was presented to a sample of 295 fourth year actuarial and finance students from the University of Cape Town. An experimental research design was used with a salient peak or trough on a share chart (the anchors) as the independent variable and participants’ estimates of a firm’s fundamental value as the dependent variable. No significant relationship between the anchor and participants’ estimates of fundamental value was found. More specifically, the research results suggested that participants experienced an anchoring effect but were debiased before providing an estimate of fundamental value. This is believed to have occurred due to the inclusion of multiple salient anchors in the research materials consistent with the nature of information available to analysts in real-world investment decision-making contexts. As these findings contradict those of most studies in anchoring and adjustment, it is recommended that more research is conducted on the relationship between the anchoring bias and stock market decisions in realistic investment settings. Additional research is also needed to clarify the effect that multiple anchors have on the anchoring bias.","abstract_html":"With three major stock market crashes in less than two decades, understanding the forces at work in the modern stock market is more important than ever before. The anchoring and adjustment heuristic has often been described as one of the psychological forces influencing investment decisions but little research has been done to support this belief. The aim of the present dissertation is to empirically study the presence of anchoring and adjustment in stock market decisions. To do this, a small group of equity analysts from South African investment firms were used for a pilot study before a survey was presented to a sample of 295 fourth year actuarial and finance students from the University of Cape Town. An experimental research design was used with a salient peak or trough on a share chart (the anchors) as the independent variable and participants’ estimates of a firm’s fundamental value as the dependent variable. No significant relationship between the anchor and participants’ estimates of fundamental value was found. More specifically, the research results suggested that participants experienced an anchoring effect but were debiased before providing an estimate of fundamental value. This is believed to have occurred due to the inclusion of multiple salient anchors in the research materials consistent with the nature of information available to analysts in real-world investment decision-making contexts. As these findings contradict those of most studies in anchoring and adjustment, it is recommended that more research is conducted on the relationship between the anchoring bias and stock market decisions in realistic investment settings. Additional research is also needed to clarify the effect that multiple anchors have on the anchoring bias.","abstract_has_math":false,"creators":["Els, Stefan"],"institution":"School of Management Studies","degree_name":null,"degree_level":null,"degree_discipline":null,"degree_department":null,"school":null,"contributors":[],"advisors":["Strugnell, Dave","Gilbert, Evan"],"committee_chairs":[],"committee_members":[],"year":2013,"date_issued":"2013","date_published":"2013","updated_at":"2026-07-22T22:22:57Z","subjects":[],"languages":["eng"],"rights":[],"rights_urls":[],"identifier_entries":[]},"links":{"outbound_url":"http://hdl.handle.net/11427/5884","outbound_label":"Handle","outbound_source":"dc:identifier.uri"},"metadata_groups":[{"id":"people","label":"People","entries":[{"key":"dc:contributor.advisor","label":"Advisor","values":["Strugnell, Dave","Gilbert, Evan"]},{"key":"dc:creator","label":"Author","values":["Els, Stefan"]}]},{"id":"academic_context","label":"Academic Context","entries":[{"key":"dc:date.accessioned","label":"Dc Date Accessioned","values":["2014-07-31T12:37:04Z"]},{"key":"dc:date.available","label":"Dc Date Available","values":["2014-07-31T12:37:04Z"]},{"key":"dc:date.issued","label":"Date","values":["2013"]},{"key":"dc:publisher.department","label":"Dc Publisher Department","values":["School of Management Studies"]},{"key":"dc:publisher.institution","label":"Dc Publisher Institution","values":["University of Cape Town"]},{"key":"dc:type","label":"Dc Type","values":["Master Thesis"]},{"key":"dc:type.qualificationlevel","label":"Dc Type Qualificationlevel","values":["Masters"]},{"key":"dc:type.qualificationname","label":"Dc Type Qualificationname","values":["MPhil"]}]},{"id":"language_rights","label":"Language and Rights","entries":[{"key":"dc:language.iso","label":"Language (ISO)","values":["eng"]}]},{"id":"identifiers","label":"Identifiers","entries":[{"key":"dc:identifier.uri","label":"Identifier URI","values":["http://hdl.handle.net/11427/5884"]}]},{"id":"additional","label":"Additional Metadata","entries":[{"key":"dc:description","label":"Description","values":["Includes abstract.","Includes bibliographical references."]},{"key":"dc:description.abstract","label":"Abstract","values":["With three major stock market crashes in less than two decades, understanding the forces at work in the modern stock market is more important than ever before. The anchoring and adjustment heuristic has often been described as one of the psychological forces influencing investment decisions but little research has been done to support this belief. The aim of the present dissertation is to empirically study the presence of anchoring and adjustment in stock market decisions. To do this, a small group of equity analysts from South African investment firms were used for a pilot study before a survey was presented to a sample of 295 fourth year actuarial and finance students from the University of Cape Town. An experimental research design was used with a salient peak or trough on a share chart (the anchors) as the independent variable and participants’ estimates of a firm’s fundamental value as the dependent variable. No significant relationship between the anchor and participants’ estimates of fundamental value was found. More specifically, the research results suggested that participants experienced an anchoring effect but were debiased before providing an estimate of fundamental value. This is believed to have occurred due to the inclusion of multiple salient anchors in the research materials consistent with the nature of information available to analysts in real-world investment decision-making contexts. As these findings contradict those of most studies in anchoring and adjustment, it is recommended that more research is conducted on the relationship between the anchoring bias and stock market decisions in realistic investment settings. Additional research is also needed to clarify the effect that multiple anchors have on the anchoring bias."]},{"key":"dc:title","label":"Title","values":["Examining the presence of anchoring and adjustment in stock market investment decisions by Stefan Els."]}]}],"canonical_facts":{"dc:contributor.advisor":["Strugnell, Dave","Gilbert, Evan"],"dc:creator":["Els, Stefan"],"dc:date.accessioned":["2014-07-31T12:37:04Z"],"dc:date.available":["2014-07-31T12:37:04Z"],"dc:date.issued":["2013"],"dc:description":["Includes abstract.","Includes bibliographical references."],"dc:description.abstract":["With three major stock market crashes in less than two decades, understanding the forces at work in the modern stock market is more important than ever before. The anchoring and adjustment heuristic has often been described as one of the psychological forces influencing investment decisions but little research has been done to support this belief. The aim of the present dissertation is to empirically study the presence of anchoring and adjustment in stock market decisions. To do this, a small group of equity analysts from South African investment firms were used for a pilot study before a survey was presented to a sample of 295 fourth year actuarial and finance students from the University of Cape Town. An experimental research design was used with a salient peak or trough on a share chart (the anchors) as the independent variable and participants’ estimates of a firm’s fundamental value as the dependent variable. No significant relationship between the anchor and participants’ estimates of fundamental value was found. More specifically, the research results suggested that participants experienced an anchoring effect but were debiased before providing an estimate of fundamental value. This is believed to have occurred due to the inclusion of multiple salient anchors in the research materials consistent with the nature of information available to analysts in real-world investment decision-making contexts. As these findings contradict those of most studies in anchoring and adjustment, it is recommended that more research is conducted on the relationship between the anchoring bias and stock market decisions in realistic investment settings. Additional research is also needed to clarify the effect that multiple anchors have on the anchoring bias."],"dc:identifier.uri":["http://hdl.handle.net/11427/5884"],"dc:language.iso":["eng"],"dc:publisher.department":["School of Management Studies"],"dc:publisher.institution":["University of Cape Town"],"dc:title":["Examining the presence of anchoring and adjustment in stock market investment decisions by Stefan Els."],"dc:type":["Master Thesis"],"dc:type.qualificationlevel":["Masters"],"dc:type.qualificationname":["MPhil"]},"updated_at":"2026-07-22T22:22:57Z"}