Entrepreneurial Stock Brokering and Switching Costs

Authors

G. Geoffrey Booth, Eli Broad Graduate School of Management, Michigan State University
Orkunt M. Dalgic, State University of New York at New Paltz
Juha-Pekka Kallunki, University of Oulu, Finland
Petri Sahlström, University of Oulu, Finland

Abstract

Stock brokers are entrepreneurs who incur switching costs when the change brokerage houses. We use Helsinki Stock Exchange data to investigate these costs by examining whether investors are loyal to their brokers when brokers move. We find that investors who have extant relationships with the new house are more likely to attract the investors from the old houses, and savvy (knowledgeable) investors are more likely to stay with their broker.

JEL Codes

G14, G15

Keywords

Stock Brokers, Switching Costs, Relationships, Helsinki Stock Exchange

Recommended Citation

Booth, G. Geoffrey; Dalgic, Orkunt M.; Kallunki, Juha-Pekka; and Sahlström, Petri (2007) "Entrepreneurial Stock Brokering and Switching Costs," Journal of Entrepreneurial Finance and Business Ventures: Vol. 12: Iss. 1, pp. 1-8.
DOI: https://doi.org/10.57229/2373-1761.1031
Available at: https://digitalcommons.pepperdine.edu/jef/vol12/iss1/2