Investor Happiness

Merkle, Christoph; Egan, Daniel P.; Davies, Greg B

doi:10.2139/ssrn.2326374

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Investor Happiness

Journal of Economic Psychology, Vol. 49, pp. 167-186, 2015

44 Pages Posted: 26 Sep 2013 Last revised: 18 Jun 2015

See all articles by Christoph Merkle

Greg B Davies

University of Oxford - Said Business School

Date Written: January 22, 2014

Abstract

We study investor happiness in a panel survey of brokerage clients at a UK bank. When investors anticipate future happiness, they set their aspirations according to personal portfolio risk, objectives, investment horizon, condence, and other individual characteristics. They are accurate in their forecasts, only rarely are investors unhappy with outcomes they predicted they would be happy with, and vice versa. However, determinants of experienced happiness only partially correspond to the ones found for anticipated happiness. In particular, relative performance plays an important role investors do not anticipate. Having outperformed other people contributes to investor happiness, as does active trading success.

Keywords: Happiness, Expectation, Experience, Individual Investors

JEL Classification: G02, G11

Suggested Citation: Suggested Citation

Merkle, Christoph and Egan, Daniel P. and Davies, Greg B, Investor Happiness (January 22, 2014). Journal of Economic Psychology, Vol. 49, pp. 167-186, 2015, Available at SSRN: https://ssrn.com/abstract=2326374 or http://dx.doi.org/10.2139/ssrn.2326374