Superstitions and Price Clustering in Taiwan Stock Exchange

This paper aims to describe cultural price clustering in Taiwan Stock Exchange. Taiwan Stock Exchange is a great example of Chinese culture exposed market, where one of basic superstitions is the aversion of unlucky numbers and the preference of lucky numbers. Using bulk historical closing price data in 5 years period, we document the prevalence of price to cluster in the lucky 8 rather than the unlucky 4. We also document the prevalence of price to cluster at Chinese lucky number group (3, 6, 8, and 9) rather than unlucky number group (4 and 7). Last, we conduct a test of proportion difference among two populations to attest difference between cultural price clustering at Chinese New Year event period and non-Chinese New Year event period. We found significance frequencies difference of price ending in 8 during Chinese New Year event period and non-Chinese New Year event perio