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Personality Traits and Portfolio Tilts Towards Value and Size

40 Pages Posted: 15 Aug 2017  

Andrew Conlin

University of Oulu

Jouko Miettunen

University of Oulu

Date Written: August 14, 2017

Abstract

We show that personality traits are related to an investor’s preferences for value versus growth stocks and for small capitalization stocks versus large capitalization stocks. We have detailed personality trait data and official register holdings of stocks for 710 individuals in Finland. The results show that more extravagant individuals tend towards large capitalization growth stocks; more impulsive people tend towards small capitalization growth stocks; more sentimental investors tend towards small capitalization value stocks; and more social investors tend towards small capitalization stocks with a tilt towards value. The results are consistent when looking at the portfolio characteristics across investors, over time, when using aggregate portfolios of investors with similar personality traits, and both widely held and non-widely held stocks.

Keywords: personality traits, portfolio choice, value premium, size premium

JEL Classification: D14, G02, G11

Suggested Citation

Conlin, Andrew and Miettunen, Jouko, Personality Traits and Portfolio Tilts Towards Value and Size (August 14, 2017). Available at SSRN: https://ssrn.com/abstract=3018383

Andrew Conlin (Contact Author)

University of Oulu ( email )

P.O. Box 4600
Oulu FIN-90014
Finland

Jouko Miettunen

University of Oulu ( email )

P.O. Box 4600
Oulu FIN-90014
Finland

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