糖心TV

George Loewenstein (Carnegie Mellon University)

Financial Attention

Recent theory posits, and empirical research supports, that individuals seek out, and in some situations avoid, information for psychological reasons. Using a novel panel data set on daily investor online logins for a large sample of 401(k) and other retirement accounts, we find strong support for selective attention to personal portfolio information that appears to be unrelated to trading-based motivations. In particular, the number of investors who login to their account falls by over 11% after market declines. This positive correlation between investor attention and market returns is consistent with a theory in which information directly affects investor utility. The attention/return correlation and the overall level of attention are also both strongly related to investor demographics (gender, age) and financial condition (wealth, portfolio holdings). Investors also pay less attention to their portfolios when news media attention to the stock market is low and when the VIX index for future stock volatility is high.