Playing the Field: Geomagnetic Storms and the Stock Market

Federal Reserve Bank of Atlanta Working Paper No. 2003-5b

53 Pages Posted: 10 Mar 2003

See all articles by Cesare Robotti

Cesare Robotti

Warwick Business School

Anya Krivelyova

Boston College - Department of Economics

Date Written: October 2003


Explaining movements in daily stock prices is one of the most difficult tasks in modern finance. This paper contributes to the existing literature by documenting the impact of geomagnetic storms on daily stock market returns. A large body of psychological research has shown that geomagnetic storms have a profound effect on people's moods, and, in turn, people's moods have been found to be related to human behavior, judgments and decisions about risk. An important finding of this literature is that people often attribute their feelings and emotions to the wrong source, leading to incorrect judgments. Specifically, people affected by geomagnetic storms may be more inclined to sell stocks on stormy days because they incorrectly attribute their bad mood to negative economic prospects rather than bad environmental conditions. Misattribution of mood and pessimistic choices can translate into a relatively higher demand for riskless assets, causing the price of risky assets to fall or to rise less quickly than otherwise. The authors find strong empirical support in favor of a geomagnetic-storm effect in stock returns after controlling for market seasonals and other environmental and behavioral factors. Unusually high levels of geomagnetic activity have a negative, statistically and economically significant effect on the following week's stock returns for all U.S. stock market indices. Finally, this paper provides evidence of substantially higher returns around the world during periods of quiet geomagnetic activity.

Note: Previously titled "Playing the Field: Geomagnetic Storms and International Stock Markets"

Keywords: Stock returns, geomagnetic storms, seasonal affective disorders, misattribution of mood, behavioral finance

JEL Classification: G1

Suggested Citation

Robotti, Cesare and Krivelyova, Anya, Playing the Field: Geomagnetic Storms and the Stock Market (October 2003). Federal Reserve Bank of Atlanta Working Paper No. 2003-5b, Available at SSRN: or

Cesare Robotti (Contact Author)

Warwick Business School ( email )

West Midlands, CV4 7AL
United Kingdom

Anya Krivelyova

Boston College - Department of Economics ( email )

140 Commonwealth Avenue
Chestnut Hill, MA 02467
United States
404-869-4715 (Phone)

Do you have negative results from your research you’d like to share?

Paper statistics

Abstract Views
PlumX Metrics