References (72)


Citations (2)



The Genetics of Investment Biases

Henrik Cronqvist

University of Miami - Department of Finance

Stephan Siegel

University of Washington - Michael G. Foster School of Business

August 20, 2013

For a long list of investment "biases," including lack of diversification, excessive trading, and the disposition effect, we find that genetic differences explain up to 45% of the remaining variation across individual investors, after controlling for observable individual characteristics. The evidence is consistent with a view that investment biases are manifestations of innate and evolutionary ancient features of human behavior. We find that work experience with finance reduces genetic predispositions to investment biases. Finally, we find that even genetically identical investors, who grew up in the same family environment, often differ substantially in their investment behaviors due to individual-specific experiences or events.

Number of Pages in PDF File: 48

Keywords: Household finance, behavioral finance, individual investor behavior

Open PDF in Browser Download This Paper

Date posted: February 23, 2012 ; Last revised: August 21, 2013

Suggested Citation

Cronqvist, Henrik and Siegel, Stephan, The Genetics of Investment Biases (August 20, 2013). Available at SSRN: http://ssrn.com/abstract=2009094 or http://dx.doi.org/10.2139/ssrn.2009094

Contact Information

Henrik Cronqvist
University of Miami - Department of Finance ( email )
P.O. Box 248094
Coral Gables, FL 33124-6552
United States
(305) 515-5898 (Phone)
HOME PAGE: http://sites.google.com/site/henrikcronqvist/
Stephan Siegel (Contact Author)
University of Washington - Michael G. Foster School of Business ( email )
Box 353200
Seattle, WA 98195-3200
United States
HOME PAGE: http://faculty.washington.edu/ss1110/
Feedback to SSRN

Paper statistics
Abstract Views: 10,356
Downloads: 1,871
Download Rank: 5,491
References:  72
Citations:  2
Paper comments
No comments have been made on this paper

© 2016 Social Science Electronic Publishing, Inc. All Rights Reserved.  FAQ   Terms of Use   Privacy Policy   Copyright   Contact Us
This page was processed by apollobot1 in 0.234 seconds