Money fractures marriages, drives wars, inspires art, motivates some people to great achievements, leads others to despair. Fear, desire, love, hate, jealousy, anger, anxiety, relief, shame and many more shades of emotion may attach to money in the course of an ordinary day. Yet, economic accounts of human financial behaviour focus on reasoned weighting of information and the utility of different courses of action. Back in the mid-nineties, whilst working as a researcher at London Business School, I got involved in a major research project looking at the risk taking behaviour of traders in investment banks.
We were struck by how readily and how articulately many of the traders talked about their emotional experience of trading. This triggered my continuing interest in emotions and financial decision-making as I moved to the Open University Business School. I continue to do research on traders but have also increasingly looked at private investors and at everyday financial decision making. Most recently myself and Adrian Furnham collaborated with the BBC to produce the Big Money Test.
In this series of blogs I plan to bring together some of the online and media resources I like or have been involved in creating and write some fresh material inspired by recent events and research. I hope to shed some light on what often gets missed by economists; the rich emotional relationships we all have with money and the financial decisions we make.
Links
Here are a few links to resources describing some of the work myself and colleagues have done in this area:-
Videoed interview at the London Stock Exchange on trading and emotion
A series of columns in the Telegraph looking at the emotional side of trading
Our book on professional traders
An iTunes podcast on Money and Emotions
Related articles
- Behavioural Finance Jan 2013 (behavioural-investing.org)
- Behavioural Finance at Barclays: An Interview with Greg B. Davies (moneyscience.com)
- LIBOR, rogue traders and the supply of motivated offenders (emotionalfinance.net)
Emotional Finance 
I can’t wait to read your future blogs about the emotions of trading. I know I have emotions when I am working with my own money! The risks involved causes excitement, anticipation and stress. I’m sure this is very different if you are a professional trader.
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Thanks for the positive feedback. My next blog will be about what we found in a survey, with the BBC, about our emotional and psychological relationships with money. However, I will return to discussing trading.
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I can’t wait to read your future blogs about the emotions of trading. I know I have emotions when I am working with my own money!
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TRADING WITH OWN FUND VIS A VIS WITH OTHERS FUND.ANY DIFFERENTIATING ATTITUDE?
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Interviews with private traders seem to confirm many of the same issues but with even greater intensity of emotion and less social support than professional traders.
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Hi Mark, this sounds really interesting! Will you put up a widget that lets us get email notification when you blog so we can follow it easily? Glad the OU supports unusual reasearch! Viv
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Thanks for the feedback. Will add the suggested widget.
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