Skin conductance predicts earnings in a market bubble-and-crash scenario
Szymon Wichary,
Monika Allenbach,
Bettina von Helversen
et al.
Abstract:In financial markets, profit is usually associated with risk-taking, as those who take risks, use the opportunities that markets present. However, during market bubbles, risk-taking might lead to losses, whereas risk aversion can lead to more profit. Emotion-based warning signals might play a role here by helping to recognize when risk aversion is preferable. To study this, we used a trading simulator, where 27 male participants traded on a historical stock price trend during a market bubble-and-crash scenario… Show more
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