Divine Catalysts: Religion and Portfolio Choices

About the seminar topic

This paper examines how religion influences equity investment and portfolio diversification. We exploit trading sessions held during a major religious festival in India that emphasises new beginnings and long-term prosperity to examine how religiously framed cues affect individual investor behaviour. Individuals whose religion is associated with the festival invest substantially more during these sessions and buy new stocks. Consistent with the emphasis on long-term prosperity, purchases are concentrated in stocks of large, mature and low-volatility firms and do not exhibit lottery-like characteristics. These investments are held longer than other portfolio positions and result in persistent increases in portfolio size and diversification. In addition, these purchases represent a larger financial commitment for lower-income individuals and smaller accounts, who subsequently benefit from increased equity exposure. Our findings highlight that religion can nudge individuals towards long-term investments and have implications for wealth accumulation.

Speaker bio

Maxime Bonelli is an Assistant Professor of Finance at London Business School.

His main research interests are in corporate finance and asset management. Maxime studies the factors shaping the organisation of the financial sector and the resulting effects on the real economy. A key strand of his work examines how the rise of big data and artificial intelligence is reshaping financial intermediation and firm behaviour.

Maxime holds a PhD in Finance from HEC Paris (2023) and a PhD in Mathematics from Inria (2016). Before his doctoral studies, he worked as a quantitative researcher in the asset management industry for more than 4 years.

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