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Personality traits and stock market participation

Author

Listed:
  • Conlin, Andrew
  • Kyröläinen, Petri
  • Kaakinen, Marika
  • Järvelin, Marjo-Riitta
  • Perttunen, Jukka
  • Svento, Rauli

Abstract

We analyze the relationship between personality traits and stock market participation. Our sample comes from combining personality trait scores and socioeconomic status information from the Northern Finland Birth Cohort 1966 with data from Finnish Central Securities Depository, the official register of stock holdings in Finland. We find the traits, and especially the subscales of the traits, to be significant predictors of stock market participation. In particular, exploratory excitability, extravagance, sentimentality, and dependence have large effects. One-standard-deviation changes in the subscale scores have marginal effects of up to 4 percentage points on the probability of participating in the stock market.

Suggested Citation

  • Conlin, Andrew & Kyröläinen, Petri & Kaakinen, Marika & Järvelin, Marjo-Riitta & Perttunen, Jukka & Svento, Rauli, 2015. "Personality traits and stock market participation," Journal of Empirical Finance, Elsevier, vol. 33(C), pages 34-50.
    • Handle: RePEc:eee:empfin:v:33:y:2015:i:c:p:34-50
    DOI: 10.1016/j.jempfin.2015.06.001
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    More about this item

    Keywords

    Stock market participation; Personality; Temperament;
    All these keywords.

    JEL classification:

    • G02 - Financial Economics - - General - - - Behavioral Finance: Underlying Principles
    • G11 - Financial Economics - - General Financial Markets - - - Portfolio Choice; Investment Decisions

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