When and How Do Advertisements Affect Investors’ Processing of Online Financial Information?

43 Pages Posted: 22 Mar 2021 Last revised: 5 Apr 2024

See all articles by Nicole L. Cade

Nicole L. Cade

University of Pittsburgh - Accounting Group

Molly Mercer

DePaul University

Amanda Winn

University of Kansas

Date Written: March 31, 2024

Abstract

We investigate when and how unrelated, proximate content such as advertisements affects investors’ processing of financial information in an online environment. Advertisements are ubiquitous on popular online financial websites and only 26 percent of U.S. investors use ad-blocking software. We posit that, consistent with source misattribution, investors will mistakenly attribute the affect advertisements elicit to proximate financial information. We conduct a series of experiments and find that product advertisements in the periphery of web pages do not affect investors’ processing of nearby financial information. Eye tracking data reveals that this effect stems from investors’ ability to avoid looking at such ads. However, we also find that advertisements inducing negative mood change investors’ perceptions of nearby financial information and, in turn, their willingness to invest. Taken together, our results suggest that users of online financial information successfully ignore many ads but would nonetheless benefit from ad-blocking software or using ad-free websites.

Keywords: investor behavior, online financial information, advertisements

JEL Classification: M31, M37, M41, G4

Suggested Citation

Cade, Nicole L. and Mercer, Molly and Winn, Amanda, When and How Do Advertisements Affect Investors’ Processing of Online Financial Information? (March 31, 2024). Available at SSRN: https://ssrn.com/abstract=3808150 or http://dx.doi.org/10.2139/ssrn.3808150

Nicole L. Cade (Contact Author)

University of Pittsburgh - Accounting Group ( email )

United States

Molly Mercer

DePaul University ( email )

1 E Jackson Blvd Suite 6000
Chicago, IL 60604
United States
(312)362-8956 (Phone)

Amanda Winn

University of Kansas

1415
Lawrence, KS 66045
United States

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
161
Abstract Views
841
Rank
346,680
PlumX Metrics