IDEAS home Printed from https://ideas.repec.org/p/cpr/ceprdp/20456.html

Trading by Professional Traders: An Experiment

Author

Listed:
  • Angrisani, Marco
  • Cipriani, Marco
  • De Filippis, Roberta
  • Guarino, Antonio
  • Kendall, Ryan

Abstract

We study the behavior of professional traders in an experiment in which, endowed with private information, they trade an asset over multiple periods. Professional traders do not produce the price bubbles observed with student subjects and aggregate private information better; bubbles also do not arise in mixed markets with traders and students trading together. Professional traders exhibit higher strategic sophistication than students as measured by their Guessing Game choices. We link strategic sophistication to trading in the financial market, and show that traders with higher levels of strategic sophistication earn higher capital gains and trading profits.

Suggested Citation

  • Angrisani, Marco & Cipriani, Marco & De Filippis, Roberta & Guarino, Antonio & Kendall, Ryan, 2025. "Trading by Professional Traders: An Experiment," CEPR Discussion Papers 20456, C.E.P.R. Discussion Papers.
    • Handle: RePEc:cpr:ceprdp:20456
    as

    Download full text from publisher

    File URL: https://cepr.org/publications/DP20456
    Download Restriction: no
    ---><---

    More about this item

    Keywords

    ;
    ;
    ;
    ;
    ;
    ;

    JEL classification:

    • C93 - Mathematical and Quantitative Methods - - Design of Experiments - - - Field Experiments
    • G11 - Financial Economics - - General Financial Markets - - - Portfolio Choice; Investment Decisions
    • G14 - Financial Economics - - General Financial Markets - - - Information and Market Efficiency; Event Studies; Insider Trading

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:cpr:ceprdp:20456. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: CEPR (email available below). General contact details of provider: https://cepr.org/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.