SENTIMENT BIAS AND ASSET PRICES: EVIDENCE FROM SPORTS BETTING MARKETS AND SOCIAL MEDIA |
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| Authors: | Arne Feddersen Brad R Humphreys Brian P Soebbing |
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| Institution: | 1. 45‐6550‐159745‐6550‐1091;2. Associate Professor, Department of Environmental and Business Economics, University of Southern Denmark, Esbjerg, Denmark;3. 304‐293‐4092304-293-2233
0000-0003-0099-7237
Professor, College of Business & Economics, West Virginia University, Morgantown, WV;4. 780-492-7308780-492-2222;5. Assistant Professor, School of Tourism and Hospitality Management, Temple University, Philadelphia, PA |
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| Abstract: | Previous research using attendance‐based proxies for sentiment bias in sports betting markets confirmed the presence of investor sentiment in these markets. We use data from social media (Facebook “Likes”) to proxy for sentiment bias and analyze variation in bookmakers' prices investor sentiment. Based on betting data from seven professional sports leagues in Europe and North America, we find evidence that bookmakers increase prices for bets on teams with relatively more Facebook “Likes,” indicating the presence of price‐insensitive investors with sentiment bias. These price changes do not affect informational efficiency in this market. (JEL L81, G14) |
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