The effect of investors moving in the same direction at the same time leads to a bandwagon effect.

Question

Quizplus · Accepted Answer

The statement is true. The bandwagon effect is a phenomenon where individuals or investors follow the actions or decisions of others, regardless of their own beliefs or knowledge about the situation. This can often lead to a self-fulfilling prophecy, as the increased demand or popularity of a certain asset or investment can cause its value or price to rise, attracting even more investors to jump on the bandwagon.

The Effect of Investors Moving in the Same Direction at the Same