Investor-advisor Big Five personality similarity and stock trading performance

Muhammad Zubair Tauni, Salman Yousaf and Tanveer Ahsan

Journal of Business Research, 2020, vol. 109, issue C, 49-63

Abstract: The purpose of this study is to investigate how investor-advisor similarities (differences) in Big Five personality are related to stock trading performance. We used an online survey questionnaire to collect data from 314 investor-advisor dyads in the Chinese stock market. Personality similarity (difference) between investor and advisor was determined using “difference score analysis”. The results showed that investor-advisor similarity in terms of openness, extraversion, conscientiousness, and agreeableness is positively related to investor stock trading performance. On the other hand, the investor-advisor similarity in neuroticism negatively affects investor trading performance. Further analysis also showed that investor-advisor similarity in demographics such as gender and education is related to stock trading performance. This research posits that retail investors show different trading performances if their personalities and demographics match (mismatch) with their advisors. Therefore, the patterns of investors’ trading performance can be jointly explained by both investors’ endogenous as well as exogenous factors.

Keywords: Personality similarity; Trading performance; The Big Five; Chinese stock market; Behavioral finance (search for similar items in EconPapers)
JEL-codes: D83 G02 G11 G12 G14 (search for similar items in EconPapers)
Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (10)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jbrese:v:109:y:2020:i:c:p:49-63

DOI: 10.1016/j.jbusres.2019.10.055

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