This study explores the anchoring effect of previous bid premiums on acquirers’ bidding behavior in serial acquisitions. We demonstrate that, after controlling for deal characteristics, learning, and unobserved factors, the current bid premium is positively correlated with the acquirer’s previous bid premium. The strength of this anchoring effect diminishes with longer time intervals between acquisitions and increases with the industry similarity of targets. Notably, it remains unaffected by the acquirer’s state ownership or acquisition frequency. Additionally, the anchoring effect is less pronounced during periods of high economic uncertainty and can reverse following a change in the acquirer’s CEO. Our findings suggest that serial acquisitions are interrelated events, challenging the notion that each bid is an isolated occurrence. This research provides insights into the underperformance of serial acquirers compared to single acquirers and the declining trend in announcement returns across successive deals.

In Chinese culture, digit 8 (4) is taken as lucky (unlucky). We find that the numerological superstition has a profound impact across China’s stock, bond, foreign exchange and commodities markets, affecting asset prices in both the primary and secondary markets. The superstition effect, i.e., the probability of asset price ending with a lucky (unlucky) digit far exceeds (falls short of) what would be expected by chance, is prevalent. The effect is driven by investors’ reliance on superstition as an anchor to face uncertainty in asset pricing and the overoptimism of unsophisticated investors. While the superstition effect does not lead to systemic mispricing for assets traded by sophisticated investors, it implies overpricing for assets involving more unsophisticated investors.