Weathering the Markets: The Impact of Weather & Device Type on Retail Investor Trading Behavior

Abstract

As digital investing becomes increasingly mobile, consumers make financial decisions in situational contexts that influence their behavior. This research investigates how local weather conditions affect retail trading activity and how these effects are moderated by device type (mobile vs. non-mobile). Using transaction data from 671 investors (244,915 investor-day observations) and a controlled online experiment (N = 401), we identify two distinct pathways-mood and perceived opportunity costs-through which weather impacts investor behavior. Field data show that a 1°C increase in temperature reduces trading volume by 7.8% for non-mobile users but increases volume by 2.7% for mobile users. Similarly, cloud cover decreases trading among non-mobile investors but increases it among mobile traders. The experimental results support a dual-path model in which mood mediates the negative effect of lower temperatures, higher precipitation, and higher cloud cover on trading across devices, while opportunity cost perceptions increase trading only for non-mobile users. These findings reveal how environmental and technological contexts interact to shape high-stakes financial behavior and suggest that mobile trading interfaces promote affect-driven engagement, while non-mobile contexts amplify trade-offs tied to situational constraints. The results offer implications for platform design, personalized nudging, and investor protection in mobile-first financial ecosystems.

Keywords: mobile investment decisions, device choice, weather, mood, perceived opportunity cost Funding: Financial support by Deutsche Forschungsgemeinschaft (DFG)