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Pop-ups Pay Off: Simulating App-Based Trading to Boost Financial Competence

Author

Listed:
  • Gabriele Iannotta

    (Politecnico di Milano)

  • Katharina Hartinger

    (Johannes Gutenberg University, Germany)

  • Tommaso Agasisti

    (Politecnico di Milano)

Abstract

The advent of commission-free trading apps has drawn millions of young, financially inexperienced users into capital markets, raising concerns about their preparedness to navigate behavioral pitfalls embedded in platform design. We evaluate two short and scalable simulation-based financial education interventions in a three-arm randomized experiment with 704 undergraduate students at an Italian university (488 completers). In both treatments, participants trade fictitious assets in an incentivized 20-round game that simulates a trading-app environment, accompanied by introductory educational content on core investment concepts. The augmented treatment additionally embeds short in-game pop-ups addressing behavioral pitfalls relevant to app-based trading, including diversification, overtrading, the disposition effect, availability bias, and herd behavior. Measured two weeks after the intervention, both treatments significantly increase financial knowledge relative to a no-intervention control group, with effect sizes of approximately 0.25-0.30 SD for the baseline Simulation and about 0.5 SD for the pop-up-augmented version. Both treatments also improve portfolio efficiency captured by a design-based Sharpe ratio computed from declared allocations, while the augmented treatment additionally increases realized in-game portfolio efficiency and revealed risk-taking during the incentivized simulation. By contrast, stated risk attitudes remain unchanged, indicating that the intervention improves how financial knowledge is translated into portfolio decisions rather than altering underlying risk preferences.

Suggested Citation

  • Gabriele Iannotta & Katharina Hartinger & Tommaso Agasisti, 2026. "Pop-ups Pay Off: Simulating App-Based Trading to Boost Financial Competence," Working Papers 2603, Gutenberg School of Management and Economics, Johannes Gutenberg-Universität Mainz, revised May 2026.
    • Handle: RePEc:jgu:wpaper:2603
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    JEL classification:

    • G53 - Financial Economics - - Household Finance - - - Financial Literacy
    • G11 - Financial Economics - - General Financial Markets - - - Portfolio Choice; Investment Decisions
    • G41 - Financial Economics - - Behavioral Finance - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making in Financial Markets
    • C93 - Mathematical and Quantitative Methods - - Design of Experiments - - - Field Experiments
    • I21 - Health, Education, and Welfare - - Education - - - Analysis of Education

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