2024, Vol. 7, Issue 1

author(s)
Mehmet Benturk

abstract
This study investigates the risks associated with rushing household stock market participation, with a specific focus on the impact of monetary policy adjustments in Turkey. After the implementation of heterodox policies, the real returns of almost all financial investment alternatives to the stock market became negative, foreign investors reduced their positions rapidly and considerably, and the size and number of IPOs reached record levels. The empirical investigation employed the SHapley Additive exPlanations (Shap) analysis in addition to the XGBoost machine learning method. The analysis has indicated that the increase in new participants in the stock market can be attributed to a reaction to insufficient financial alternatives and real returns. This phenomenon leads to the presence of the risk of irrational pricing in the market and exposes households to vulnerabilities arising from their risky portfolio.