{"id":16026,"date":"2019-10-17T08:53:35","date_gmt":"2019-10-17T08:53:35","guid":{"rendered":"http:\/\/www.uwb.edu\/?p=16026"},"modified":"2024-05-30T02:07:26","modified_gmt":"2024-05-30T09:07:26","slug":"oct-18","status":"publish","type":"page","link":"https:\/\/www.uwb.edu\/business\/events\/research-talks\/archive\/2019-2020\/oct-18","title":{"rendered":"Informed speculation with k-level reasoning"},"content":{"rendered":"\n<h2 class=\"wp-block-heading\">Research Talk for October 18, 2019<\/h2>\n\n\n\n<h4 class=\"wp-block-heading\">Title<\/h4>\n\n\n\n<p>Informed speculation with k-level reasoning<\/p>\n\n\n\n<h4 class=\"wp-block-heading\">Presenter<\/h4>\n\n\n\n<p>Hang Zhou, UC Davis<\/p>\n\n\n\n<h4 class=\"wp-block-heading\">Date<\/h4>\n\n\n\n<p>October 18, 2019<\/p>\n\n\n\n<h4 class=\"wp-block-heading\">Location<\/h4>\n\n\n\n<p>UW Bothell main campus<br>\nBuilding: UWBB<br>\nRoom: 240<\/p>\n\n\n\n<h4 class=\"wp-block-heading\">Abstract<\/h4>\n\n\n\n<p>This paper studies the effect of strategic reasoning on financial markets by revisiting the micro structure model \u00c3&nbsp; la Kyle (1989) with the level-k reasoning framework. A level-k speculator performs k rounds of iterative reasoning to infer information from asset price. In contrast to symmetric Bayesian Nash equilibrium, the level-k framework explains the coexistence of momentum and contrarian trading strategies. As for market implication, this paper discusses how the distribution of reasoning levels affects macro variables and sheds new light on empirical puzzles such as: (1) overvaluation of assets, (2) extra price volatility and (3) excessive trading volume.<\/p>\n\n\n\n<h4 class=\"wp-block-heading\">Paper<\/h4>\n\n\n\n<p><a href=\"https:\/\/uwnetid-my.sharepoint.com\/:b:\/g\/personal\/cmbrewer_uw_edu\/EbpBB58753xOlmevwQKpICIBPn0-yJXVK-OO8NK_r9S24g\" target=\"_blank\" rel=\"noopener\">Download paper (PDF)<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Research Talk for October 18, 2019 Title Informed speculation with k-level reasoning Presenter Hang Zhou, UC Davis Date October 18, 2019 Location UW Bothell main campus Building: UWBB Room: 240 Abstract This paper studies the effect of strategic reasoning on financial markets by revisiting the micro structure model \u00c3&nbsp; la Kyle (1989) with the level-k&#8230;<\/p>\n","protected":false},"author":44,"featured_media":0,"parent":16022,"menu_order":4,"comment_status":"open","ping_status":"open","template":"","meta":{"_acf_changed":false,"_is_archived":false,"_archived_contact_email":"","footnotes":""},"class_list":["post-16026","page","type-page","status-publish","hentry"],"acf":{"related_links":{"toggle_visibility":false,"link_1":"","link_2":"","link_3":"","link_4":"","link_5":""},"highlight_box":{"toggle_visibility":false,"title":"","content":"","button":"","button_style":"angled-purple-button","button_screen_reader_text":""},"contact_type_1":{"toggle_visibility":true,"contact_title":"School of Business","email":"uwbbusiness@uw.edu","phone":"425.352.5394","box":"Box 358533","address_line_1":"18807 Beardslee Blvd, Suite 210","address_line_2":"Bothell, WA 98011","location":""},"contact_type_2":{"toggle_visibility":false,"contact_title":"","email":"","phone":"","box":"","address_line_1":"","address_line_2":"","location":""},"social_media":{"toggle_visibility":false,"facebook_url":"","instagram_url":"","linkedin_url":"","twitter_url":"","youtube_url":""},"blog_archive_sidebar_visibility":false},"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.0 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Informed speculation with k-level reasoning - School of Business<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.uwb.edu\/business\/events\/research-talks\/archive\/2019-2020\/oct-18\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Informed speculation with k-level reasoning - School of Business\" \/>\n<meta property=\"og:description\" content=\"Research Talk for October 18, 2019 Title Informed speculation with k-level reasoning Presenter Hang Zhou, UC Davis Date October 18, 2019 Location UW Bothell main campus Building: UWBB Room: 240 Abstract This paper studies the effect of strategic reasoning on financial markets by revisiting the micro structure model \u00c3&nbsp; la Kyle (1989) with the level-k...\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.uwb.edu\/business\/events\/research-talks\/archive\/2019-2020\/oct-18\" \/>\n<meta property=\"og:site_name\" content=\"School of Business\" \/>\n<meta property=\"article:modified_time\" content=\"2024-05-30T09:07:26+00:00\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data1\" content=\"1 minute\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.uwb.edu\/business\/events\/research-talks\/archive\/2019-2020\/oct-18\",\"url\":\"https:\/\/www.uwb.edu\/business\/events\/research-talks\/archive\/2019-2020\/oct-18\",\"name\":\"Informed speculation with k-level reasoning - School of Business\",\"isPartOf\":{\"@id\":\"\/#website\"},\"datePublished\":\"2019-10-17T08:53:35+00:00\",\"dateModified\":\"2024-05-30T09:07:26+00:00\",\"breadcrumb\":{\"@id\":\"https:\/\/www.uwb.edu\/business\/events\/research-talks\/archive\/2019-2020\/oct-18#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/www.uwb.edu\/business\/events\/research-talks\/archive\/2019-2020\/oct-18\"]}]},{\"@type\":\"BreadcrumbList\",\"@id\":\"https:\/\/www.uwb.edu\/business\/events\/research-talks\/archive\/2019-2020\/oct-18#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"Home\",\"item\":\"https:\/\/www.uwb.edu\/business\/\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"Events\",\"item\":\"https:\/\/www.uwb.edu\/business\/events\"},{\"@type\":\"ListItem\",\"position\":3,\"name\":\"Research Talks\",\"item\":\"https:\/\/www.uwb.edu\/business\/events\/research-talks\"},{\"@type\":\"ListItem\",\"position\":4,\"name\":\"Archive\",\"item\":\"https:\/\/www.uwb.edu\/business\/events\/research-talks\/archive\"},{\"@type\":\"ListItem\",\"position\":5,\"name\":\"2019-2020 Research Talks\",\"item\":\"https:\/\/www.uwb.edu\/business\/events\/research-talks\/archive\/2019-2020\"},{\"@type\":\"ListItem\",\"position\":6,\"name\":\"Informed speculation with k-level reasoning\"}]},{\"@type\":\"WebSite\",\"@id\":\"\/#website\",\"url\":\"\/\",\"name\":\"School of Business\",\"description\":\"Just another UW Bothell site\",\"potentialAction\":[{\"@type\":\"SearchAction\",\"target\":{\"@type\":\"EntryPoint\",\"urlTemplate\":\"\/?s={search_term_string}\"},\"query-input\":{\"@type\":\"PropertyValueSpecification\",\"valueRequired\":true,\"valueName\":\"search_term_string\"}}],\"inLanguage\":\"en-US\"}]}<\/script>\n<!-- \/ Yoast SEO plugin. -->","yoast_head_json":{"title":"Informed speculation with k-level reasoning - School of Business","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/www.uwb.edu\/business\/events\/research-talks\/archive\/2019-2020\/oct-18","og_locale":"en_US","og_type":"article","og_title":"Informed speculation with k-level reasoning - School of Business","og_description":"Research Talk for October 18, 2019 Title Informed speculation with k-level reasoning Presenter Hang Zhou, UC Davis Date October 18, 2019 Location UW Bothell main campus Building: UWBB Room: 240 Abstract This paper studies the effect of strategic reasoning on financial markets by revisiting the micro structure model \u00c3&nbsp; 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