Does Reminding of Behavioural Biases Increase Returns from Financial Trading? A Field Experiment

Maria De Paola (m.depaola@unical.it), Francesca Gioia (francesca.gioia@unimi.it) and Fabio Piluso

International Journal of Economics and Finance, 2020, vol. 12, issue 2, 1

Abstract: Nudge policies are interventions that aim to guide the individual to behave according to the policy’s objectives without changing the option set or economic incentives. We ran a field experiment to investigate whether nudge policies, consisting in behavioural insight messaging, help to improve performance in financial trading. Our experiment involved students enrolled in a financial trading course in an Italian University who were invited to trade on Borsa Italiana’s virtual platform. Students were randomly assigned to a control group and a treatment group. Treated students received a message reminding them of the existence of behavioural biases in financial trading. We find that treated students significantly improve the performance of their portfolio. Several behaviours may explain the increase in performance. We find evidence pointing to a reduction in the home and status quo biases for risk averse nudged participants.

Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://www.ccsenet.org/journal/index.php/ijef/article/download/0/0/41803/43422 (application/pdf)
http://www.ccsenet.org/journal/index.php/ijef/article/view/0/41803 (text/html)

Related works:
Working Paper: DOES REMINDING OF BEHAVIOURAL BIASES INCREASE RETURNS FROM FINANCIAL TRADING? A FIELD EXPERIMENT (2017)
Working Paper: Does Reminding of Behavioural Biases Increase Returns from Financial Trading? A Field Experiment (2017)
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:ibn:ijefaa:v:12:y:2020:i:2:p:1

Access Statistics for this article

More articles in International Journal of Economics and Finance from Canadian Center of Science and Education Contact information at EDIRC.
Bibliographic data for series maintained by Canadian Center of Science and Education (ijef@ccsenet.org).