EconPapers    
Economics at your fingertips  
 

What Makes a Good Trader? On the Role of Intuition and Reflection on Trader Performance

Brice Corgnet (), Mark Desantis and David Porter

Journal of Finance, 2018, vol. 73, issue 3, 1113-1137

Abstract: Using laboratory experiments, we provide evidence on three factors influencing trader performance: fluid intelligence, cognitive reflection, and theory of mind (ToM). Fluid intelligence provides traders with computational skills necessary to draw a statistical inference. Cognitive reflection helps traders avoid behavioral biases and thereby extract signals from market orders and update their prior beliefs accordingly. ToM describes the degree to which traders correctly assess the informational content of orders. We show that cognitive reflection and ToM are complementary because traders benefit from understanding signals’ quality only if they are capable of processing these signals.

Date: 2018
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (13) Track citations by RSS feed

Downloads: (external link)
https://doi.org/10.1111/jofi.12619

Related works:
Working Paper: What Makes a Good Trader? On the Role of Intuition and Reflection on Trader Performance (2018)
Working Paper: What Makes a Good Trader? On the Role of Intuition and Reflection on Trader Performance (2016) Downloads
Working Paper: What Makes a Good Trader? On the Role of Intuition and Reflection on Trader Performance (2016) Downloads
Working Paper: What Makes a Good Trader? On the Role of Intuition and Reflection on Trader Performance (2016) Downloads
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:bla:jfinan:v:73:y:2018:i:3:p:1113-1137

Ordering information: This journal article can be ordered from
http://www.afajof.org/membership/join.asp

Access Statistics for this article

More articles in Journal of Finance from American Finance Association Contact information at EDIRC.
Bibliographic data for series maintained by Wiley Content Delivery ().

 
Page updated 2020-07-02
Handle: RePEc:bla:jfinan:v:73:y:2018:i:3:p:1113-1137