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The effects of personality and IQ on portfolio outcomes
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Firth, Chris, Stewart, Neil, Antoniou, Constantinos and Leake, David (2023) The effects of personality and IQ on portfolio outcomes. Finance Research Letters , 51 . 103464. doi:10.1016/j.frl.2022.103464 ISSN 1544-6123.
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Official URL: http://dx.doi.org/10.1016/j.frl.2022.103464
Abstract
We use responses to a self-report survey and matched administrative data to investigate the effects of personality (Big Five traits) and IQ on individuals’ stock trading portfolios. Traits have small but significant effects: openness and extraversion are associated with undesirable outcomes whereas conscientiousness is associated beneficially. Higher IQ is associated with lower trading activity but not enhanced investment performance. We postulate these factors influence outcomes in a complex manner, and exert over long timeframes. With portfolio size held constant, financial literacy has little effect. Other factors, such as customer age, portfolio size and portfolio risk, better explain outcomes.
| Item Type: | Journal Article | ||||||||||||
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| Subjects: | B Philosophy. Psychology. Religion > BF Psychology H Social Sciences > HG Finance |
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| Divisions: | Faculty of Social Sciences > Warwick Business School | ||||||||||||
| Library of Congress Subject Headings (LCSH): | Financial literacy, Personality, Intelligence levels, Decision making | ||||||||||||
| Journal or Publication Title: | Finance Research Letters | ||||||||||||
| Publisher: | Academic Press | ||||||||||||
| ISSN: | 1544-6123 | ||||||||||||
| Official Date: | January 2023 | ||||||||||||
| Dates: |
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| Volume: | 51 | ||||||||||||
| Number of Pages: | 8 | ||||||||||||
| Article Number: | 103464 | ||||||||||||
| DOI: | 10.1016/j.frl.2022.103464 | ||||||||||||
| Status: | Peer Reviewed | ||||||||||||
| Publication Status: | Published | ||||||||||||
| Access rights to Published version: | Open Access (Creative Commons) | ||||||||||||
| Date of first compliant deposit: | 14 November 2022 | ||||||||||||
| Date of first compliant Open Access: | 14 November 2022 | ||||||||||||
| RIOXX Funder/Project Grant: |
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