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Are two heads better than one? An experiment with novice share traders

Author

Listed:
  • Richard Heaney

    (RMIT University, richard.heaney@rmit.edu.au)

  • F. Douglas Foster

    (The Australian National University)

  • Shirley Gregor

    (The Australian National University)

  • Terry O'Neill

    (The Australian National University)

  • Robert Wood

    (Melbourne Business School)

Abstract

We compare the performance of individual and two-person teams in an electronic share-trading task. Trader profits are negatively related to the amount of trader market activity and positively related to trader confidence. While we find no evidence of a difference in trading profit between individual and team traders, profit volatility is more sensitive to trading activity for teams. Team trading profit is positively related to attitude and negatively related to perceptions of the difficulty of the task, with overall team trading activity negatively related to views of team members’ abilities. JEL Code: D44, G14

Suggested Citation

  • Richard Heaney & F. Douglas Foster & Shirley Gregor & Terry O'Neill & Robert Wood, 2010. "Are two heads better than one? An experiment with novice share traders," Australian Journal of Management, Australian School of Business, vol. 35(2), pages 119-142, August.
    • Handle: RePEc:sae:ausman:v:35:y:2010:i:2:p:119-142
    DOI: 10.1177/0312896210370078
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    References listed on IDEAS

    as
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    Cited by:

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    2. Jennifer K Gippel, 2013. "A revolution in finance?," Australian Journal of Management, Australian School of Business, vol. 38(1), pages 125-146, April.

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    Keywords

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    JEL classification:

    • D44 - Microeconomics - - Market Structure, Pricing, and Design - - - Auctions
    • G14 - Financial Economics - - General Financial Markets - - - Information and Market Efficiency; Event Studies; Insider Trading

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