Personal Traits and Trading in an Experimental Asset Market

Tomas Miklanek and Miroslav Zajicek

CERGE-EI Working Papers from The Center for Economic Research and Graduate Education - Economics Institute, Prague

Abstract: We study the relationship between personal traits and trading outcomes in continuous double auction asset markets. There are mixed theoretical predictions about this relationship followed by similarly mixed empirical evidence. We examine the correlation of cognitive skills, willingness to speculate, risk attitude, willingness to compete, and overconfidence with trading activity in a very simple experimental market with one asset and no uncertainty about the fundamental value. We build on a market setting very close to the canonical one of Smith, Suchanek and Williams (1988) with a constant fundamental value. We conclude that willingness to speculate is the main driver of trading activity. Willingness to speculate and cognitive skills are the only significant predictors for achieved profits from trading. Our experimental results could provide a benchmark for trading activity outcomes in more complicated, real world asset market environments.

Keywords: experimental economics; asset market; trading activity; personal traits (search for similar items in EconPapers)
JEL-codes: C91 D53 D91 G41 (search for similar items in EconPapers)
Date: 2020-01
New Economics Papers: this item is included in nep-exp, nep-fmk and nep-neu
References: Add references at CitEc
Citations:

Downloads: (external link)
http://www.cerge-ei.cz/pdf/wp/Wp654.pdf (application/pdf)

Related works:
Journal Article: Personal traits and trading in an experimental asset market (2020)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:cer:papers:wp654

Access Statistics for this paper

More papers in CERGE-EI Working Papers from The Center for Economic Research and Graduate Education - Economics Institute, Prague Contact information at EDIRC.
Bibliographic data for series maintained by Lucie Vasiljevova ().