Herding Behaviour in Financial Markets: Empirical Evidence
from the Johannesburg Stock Exchange

Kofi A. Ababio
Kumasi Technical University and University of Johannesburg

John W. Muteba Mwamba
University of Johannesburg



The study tests evidence of herding behaviour in the South Africa’s financial industry using the conventional approaches. In addition, the study adopts the Bayesian linear regression model as an extension of the traditional approaches to estimating the empirical data on daily stock returns from January 2010 to September 2015. With the exception of the insurance sector, we found evidence of herding behaviour in the banking, general financials and real estate sectors under extremely high and low market returns using the conventional approaches only. The financial industry also exhibited the behavioural bias employing the CSAD and the Bayesian regression techniques.