Something I read recently is somewhat related to this, and interested me a great deal. It's called the disposition effect -
here's a link if you are as intrigued by group psych as I am. It describes investors' tendency to sell appreciated securities quicker and to hold onto losers longer, otherwise known as "get back to even-itis".
The original paper (which I am too lazy to find now) demonstrated an abnormal rate of return is achievable by buying stocks that have a positive earnings surprise and substantial pre-release appreciation. Conversely, they sold stocks after negative earnings surprise that have substantial pre-release depreciation.
Now, this study was done a while ago and extensively covered by the markets, so I expect most of it to not work very well anymore... but this is human psychology we're talking about, and there must be inefficiencies everywhere related to this phenomenon.
Anyone tailor a strategy around this, or a variation?
Oh, and if you have any other group psych related papers, send em over, these kinds of research papers I read for fun.