Imagine Mr. Trader entering a day trade of 1000 units of Jindal Steel one fine Monday morning for Rs 1700 a unit and then returning from a 2 minute Bio Break and finding himself sitting on a loss of Rs 1 lakh plus. That would make it a Bio Break worth 1 lakh and sure as hell get his blood pumping, wouldn’t it?
An interesting research conducted by the University of Cambridge, England recently found out that Testosterone, the male hormone that drives aggression, confidence and sexual interest also seems to put financial success in overdrive. The study also cautions that aggravated Testosterone levels over several weeks can result in irrational risk taking.
Saliva samples taken from stock traders in morning and evening showed that the levels of Testosterone and Cortisol affected traders. Traders with unusually high level of Testosterone were more likely to make an unusually large profit during the day. Cortisol on the other hand helped in risk-aversion. Cortisol is linked to uncertainty, novelty and unpredictability. In case of a market crash, the level of Cortisol rises, thus increasing a trader’s ability of risk-aversion.
How relevant this study is in the Indian Trader’s context, only GOD knows. Usually in India we see even during good trading sessions, flocks of speculative suicide traders following each other’s lead even if Mr. Junjhunwala himself is screaming SELL!! SELL!! SELL!!
(Based on an extract from Investors India)
3 comments:
ha ha ha ha...funny one..i wonder why they didn't include female subjects for the research...Amar.
This is an old logic and was usually linked with gambling at the table and driving by Chanakya in the ultimate Arthasastra :)
Good observation!
ha ha....
so along with the profiles of fund managers... we might get the info on their testosterone levels in coming days.... :-) nd even companies recruiting us for dat positions might as well come with testosterone tests along wth othrs dey usually take.......
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