Investor Behavior at the 52 Week High

This study uncovers how household investors intensify the 52 week high (52WH) effect:increased volume and momentum-like returns at the 52WH price. Using daily householdand institutional trading, we find that households sharply increase their, limit order, sells atthe 52WH price. This behavior is indicative of anchoring as it is robust to past returns, andintensified by market uncertainty and salience of the 52WH. This uninformed limit orderselling at, and prior to, the 52WH leads to a doubling of the unconditional 52WH anomalyreturns. The post-event returns are to the benefit of institutions who act as counter parties.