Does the Color of Feedback Affect Investment Decisions?

Tal Shavit (), Mosi Rosenboim and Chen Cohen
Additional contact information
Mosi Rosenboim: The School of Business Administration, The College of Management Academic Studies, Israel
Chen Cohen: Department of Economics and Management, The Open University of Israel, Raanana, Israel

International Journal of Applied Behavioral Economics (IJABE), 2013, vol. 2, issue 3, 15-26

Abstract: This paper presents a multi-period experiment that extends a classic experiment on investment allocation preferences by adding colors to the feedback returned to participants. The results show that investors allocate the same proportion of their investment to the stock and the bond funds without regard to the colors. However, red feedback activates an avoidance motivation (vs. an approach motivation), and this reduces chasing past returns. The authors also found that the color of the feedback affected the time needed to make a decision. Financial institutions might use colored feedback to encourage approach or avoidance motivations in their clients.

Date: 2013
References: Add references at CitEc
Citations:

Downloads: (external link)
http://services.igi-global.com/resolvedoi/resolve. ... 018/ijabe.2013070102 (application/pdf)

Related works:
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:igg:jabe00:v:2:y:2013:i:3:p:15-26

Access Statistics for this article

International Journal of Applied Behavioral Economics (IJABE) is currently edited by Yun Wan

More articles in International Journal of Applied Behavioral Economics (IJABE) from IGI Global
Bibliographic data for series maintained by Journal Editor ().