DOSPERT's Gambling Risk-Taking Propensity Scale Predicts Excessive Stock Trading

Markiewicz, Łukasz; Weber, Elke U.

doi:10.1080/15427560.2013.762000

Cited by 85 publications

(70 citation statements)

References 30 publications

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“…Attitude can, after all, measure general knowledge instead of predicting a particular, personal intention (Ajzen et al 2011). Second, risks are approached differently per domain (Nicholson et al 2005;Weber, Blais, and Betz 2002), with for example investment risk propensity unrelated to recreational risk propensity but correlating positively with social risk propensity (Markiewicz and Weber 2013), implying that attitude towards risk affects different domain-specific intentions.…”

Section: Theorymentioning

confidence: 99%

Psychological determinants of financial buffer saving: the influence of financial risk tolerance and regulatory focus

Magendans

Gutteling

Zebel

2016

Journal of Risk Research

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With governments redistributing more responsibilities unto citizens, individuals have an increasing need for financial resources acting as a buffer against life's setbacks and unexpected expenditures. The purpose of this study was to examine psychological determinants of saving for a financial buffer, for which a theoretical model was formulated based on the theory of planned behaviour with three new, domain-specific psychological constructs: financial risk tolerance, regulatory focus and perceived saving barriers. Data were collected with an online questionnaire that utilised convenience and snowball sampling to target both students and working individuals (N = 272). Regression analyses offered support for the proposed model, showing that participants' financial risk tolerance (i.e. an individual's attitude towards financial risk taking) was significantly associated with their subjective financial knowledge and regulatory focus. Furthermore, perceived financial self-efficacy and financial risk tolerance both predicted participants' intention to save for a financial buffer. In turn, perceived financial selfefficacy and saving intention predicted self-reported saving behaviour. Importantly, perceived saving barriers mediated the relationship between saving intention and self-reported saving behaviour. In line with the proposed model, results also showed that a specific attitude-based construct (financial risk tolerance) is a considerably better predictor of saving intention than general measures of attitude towards saving. This study is also the first to demonstrate that regulatory focus influences financial risk tolerance. Implications of these findings for stimulating saving behaviour are discussed.

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Section: Theorymentioning

confidence: 99%

Psychological determinants of financial buffer saving: the influence of financial risk tolerance and regulatory focus

Magendans

Gutteling

Zebel

2016

Journal of Risk Research

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“…There is copious empirical and experimental evidence that higher risk propensity is accompanied by an increase in trade frequency, and on the contrary, higher risk aversion manifests itself in lower market activity (Durand, Newby, & Sanghani, 2008;Fellner & Maciejovsky, 2007;Markiewicz & Weber, 2013;Robin, Straznicka, & Villeval, 2012). Overconfidence, however, is a factor that induces active engagement in trading (see above).…”

Section: Introductionmentioning

confidence: 99%

Overconfidence, risk aversion and individual financial decisions in experimental asset markets

Michailova

Mačiulis²,

Tvaronavičienė

2017

Economic Research-Ekonomska Istraživanja

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Prior experiments revealed that investors' overconfidence can result in excessive trade and negative wealth effects. However, in most of these studies, informational asymmetries were part of the experimental design, and therefore no clear conclusion on whether the obtained results were driven by overconfidence or informational asymmetries could be made. The article addresses this issue by analysing individual financial decisions based on the study of Michailova and Schmidt, who ran an asset markets experiment with no informational asymmetries. Additionally, the study controls for differences in individual risk aversion. The data revealed that, in this setting, individual trading activity and performance were influenced by overconfidence only for female participants. Mistakes in future price forecasting, which were negatively correlated with overconfidence, partially accounted for this result. Risk aversion was uncorrelated with overconfidence and had no influence on experimental outcomes.

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“…This behavior was considered as part of a need for sensation-seeking. Markiewicz and Weber (2013) have also demonstrated that risk-taking in day traders appears to be more of a means to experience thrill rather than to obtain the coveted financial gain.…”

Section: Signs Of Excessive Tradingmentioning

confidence: 99%

“…Thus, specific characteristics in excessive trading may be overlooked when using criteria intended to measure gambling-related behaviors that were studied in individuals who partake in gambling activities such as poker, roulette, or slot machines. Namely, underlying motivations for trading and gambling can be different (Markiewicz & Weber, 2013). Also, while gambling typically has a negative expected return over a long-term period (Ladouceur et al, 2002), stock trading is above all a method of investment; the expected return is usually positive.…”

Section: Introductionmentioning

confidence: 99%

“…This finding suggests that option traders were not solely motivated by financial gain, but possibly also by the thrill inherent to risk-taking in gambling. Moreover, Markiewicz and Weber (2013) assessed the nature of risk-taking in gambling and investing with a sample consisting mostly of young male university students (N = 633). Their study shows that a high gambling propensity as measured by a subscale of the Domain Specific Risk Taking scale (DOSPERT) (Weber, Blais, & Betz, 2002), a measure for risk-taking in five domains (financial decisions including gambling and investing, health/safety, recreational, ethical and social decisions), predicts trading volume and participation in day trading.…”

Section: Introductionmentioning

confidence: 99%

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What Characterizes Excessive Online Stock Trading? A Qualitative Study.

Dixon¹,

Giroux²,

Jacques³

et al. 2018

JGI

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Excessive online stock trading appears to share similarities with gambling disorder. However, using gambling disorder criteria to assess excessive trading may not allow a full understanding of this phenomenon as specific aspects of the trading context that differ from gambling may be overlooked. This study explores the manifestations and consequences of excessive trading and its links with gambling disorder via the perceptions of online stock traders themselves. Data for thematic analysis were collected from a sample of online stock traders (N = 13) divided into two focus groups based on trading frequency (i.e., on a regular or occasional basis). Perceived manifestations of excessive trading included excessive preoccupation and frequent behaviors, and consequences that affect finances, relationships, work and health. Perceived links between gambling disorder and excessive trading concerned a shared incapacity to control behaviors, and chasing losses. Though excessive trading and gambling disorder are similar on many grounds, the assessment of trading behaviors should consider specific aspects such as the context within which they occur (e.g., state of the market). Implications for future research on excessive trading behaviors are discussed.Keywords: stock market trading, online gambling, gambling disorder, gambling behavior RésuméLes transactions d'actions excessives peuvent présenter des similitudes avec le jeu pathologique. Cependant, appliquer des critères propres au jeu pathologique à des pratiques de transactions excessives en ligne ne permet pas nécessairement de bien comprendre ce phénomène, car il pourrait arriver qu'on néglige certains aspects particuliers du contexte transactionnel qui diffèrent du contexte du jeu. Cette étude explore les manifestations et les conséquences de pratiques transactionnelles excessives 8

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DOSPERT's Gambling Risk-Taking Propensity Scale Predicts Excessive Stock Trading

Cited by 85 publications

References 30 publications

Psychological determinants of financial buffer saving: the influence of financial risk tolerance and regulatory focus

Psychological determinants of financial buffer saving: the influence of financial risk tolerance and regulatory focus

Overconfidence, risk aversion and individual financial decisions in experimental asset markets

What Characterizes Excessive Online Stock Trading? A Qualitative Study.

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