Do personality traits influence investors’ portfolios?

Bucciol, Alessandro; Zarri, Luca

doi:10.1016/j.socec.2017.03.001

Cited by 75 publications

(69 citation statements)

References 58 publications

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“…Furthermore, there is evidence on correlations between low neuroticism and high openness (as Big-5 personality traits) and risk taking (Lauriola and Levin, 2001). Brown and Taylor (2014) report on the correlation between extraversion and openness and the levels of debt and assets held and Bucciol and Zarri (2017) show that agreeableness is negatively associated with stock holdings (see Bucciol and Zarri, 2017, for further evidence on the impact of personality traits beyond the Big-5 ). 12 Thus, if personality traits of finance professionals systematically differ from the rest of the population, this might well have an influence on decisions made within the finance industry, in particular on behalf of clients.…”

Section: Personality Traitsmentioning

confidence: 99%

Economic Preferences and Personality Traits Among Finance Professionals and the General Population

et al. 2021

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Since the financial crisis, the behavior and personality traits of finance professionals have come under scrutiny. As comprehensive scientific findings are lacking, we run artefactual field experiments with finance professionals and a sample of the working population to investigate differences across industryrelevant economic preferences and personality traits. We report that finance professionals are more risk tolerant, more selfish, less trustworthy, and show higher levels of narcissism, psychopathy, and Machiavellianism. However, we find that many of these differences disappear after adjusting for socio-economic characteristics, indicating that finance professionals are similar to employees in other industries with a comparable socio-economic background.

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Section: Personality Traitsmentioning

confidence: 99%

Economic Preferences and Personality Traits Among Finance Professionals and the General Population

et al. 2021

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“…This research emphasis is based on the notion that risk preference is highly stable over time and across different life domains, and more importantly, is related to many important economic and health outcomes (Kuhlman & Zuckerman, 2000;Lauriola & Levin, 2001;Mata, Frey, Richter, Schupp, & Hertwig, 2018). A very wide range of traits have also been considered from the perspectives of cynical hostility (Bucciol & Zarri, 2017) to Type A/B behavior.…”

Section: Personality and Financial Decision Makingmentioning

confidence: 99%

Recruiting, selecting, retaining, and monitoring successful investment managers: A review of a scattered literature

Furnham

2020

Fin Plan Rev

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This article attempts a comprehensive and multi-disciplinary review of a scattered literature on the characteristics of successful investment managers. It considers nonpeer reviewed papers and reports written by organizations and human resource experts but also empirical papers from those in disciplines such as business studies, economics, finance, psychology, and psychiatry. It focuses on three issues: Ability, personality, and motivation. Most of the studies have concentrated on motivation and various themes are apparent suggesting that it is possible to profile successful investment managers.

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“…Other evidence for this link can be found in analyses that focus on the trait-anxiety levels of individuals, one of the subscales (facets) of neuroticism in many models of personality. Individuals with high trait-anxiety tend to be risk-averse in a general sense (e.g., Maner et al, 2007), are more reluctant to acquire equity or debt securities, and have a greater preference for less risky portfolios than other individuals (Gambetti & Giusberti, 2012;Bucciol & Zarri, 2017).…”

Section: Introductionmentioning

confidence: 99%

Neuroticism and home bias

Niszczota¹

2020

Preprint

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In this paper I investigate whether neuroticism has a negative impact on investment in foreign securities, exacerbating the ‘home bias’ present while investing in stocks and bonds. This hypothesis is motivated by research which: (1) established a link between neuroticism and fear of uncertainty, (2) revealed that investors feel greater uncertainty when considering investment in foreign securities, and (3) shown that negative affect impacts in-group bias. I explore this hypothesis on both the country level (using cross-country observational data) and individual level (using the responses of students that were given a hypothetical investment scenario). Additionally, I explore whether the predicted relationship is further exacerbated when uncertainty or anxiety is high, or when the investment destination is dissimilar from the investors’ own country. The country-level analysis reveals that investors from high-neuroticism countries generally invest less in foreign equities than investors from other countries, and provides some support that this tendency can become more pronounced when investing in times of high uncertainty or in culturally dissimilar countries. The hypothesized relationship is also present in the responses of male students in a high-anxiety (stressful) condition. Given that professional investors are predominantly male, and work under high stress, this explains to some extent why investors have a bias towards domestic securities.

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Do personality traits influence investors’ portfolios?

Cited by 75 publications

References 58 publications

Economic Preferences and Personality Traits Among Finance Professionals and the General Population

Economic Preferences and Personality Traits Among Finance Professionals and the General Population

Recruiting, selecting, retaining, and monitoring successful investment managers: A review of a scattered literature

Neuroticism and home bias

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