Herding behaviour in the Indian stock market: An empirical study
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CSAD, CSSD, Herding behaviour, Indian stock market, Structural breakpoint, Trading volume.

How to Cite

Dhuri, V. ., & Patkar, S. . (2024). Herding behaviour in the Indian stock market: An empirical study. Asian Economic and Financial Review, 14(4), 264–275. https://doi.org/10.55493/5002.v14i4.5018


The rapid growth of the Indian stock market in recent decades has prompted much study on investing, focusing on understanding and analysing investors' tactics for investment and trading. Over the years, researchers have cited and conducted in-depth investigations into various psychological biases. Herding bias is extensively studied to understand how investors participate in investment and trading in the Indian stock market. The current study on herding provides an investigation into the existence of herd activity in the share market of India. The study attempts to identify herd activity during positive, negative, extreme positive, and extreme negative market conditions, as well as during structural breakpoints and trade volumes that are low as well as high. The researchers have used the modified CSAD (Cross Sectional Absolute Deviation) model to enhance its validity. The findings reveal the rationality of investors during the different market states. However, herding behaviour was evidenced during certain periods at the structural breakpoint. This implies that during positive as well as negative market conditions, herding behaviour is absent, except during certain structural breakpoints and high trading volumes.

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