Document Type



Doctor of Philosophy (PhD)



First Advisor's Name

Robert T. Daigler

First Advisor's Committee Title

Committee Chair

Second Advisor's Name

Brice Dupoyet

Third Advisor's Name

Chun-Hao Chang

Fourth Advisor's Name

John Nofsinger

Fifth Advisor's Name

Anthony De Caprio


Investor Behavior, Behavioral Finance, Testosterone, Cortisol, Stress, Personality, Decision Making

Date of Defense



This doctoral dissertation addresses the biological and psychological components of financial decision-making for individuals. As such, it directly examines intrinsic human traits that are related to financial performance, rather than following the standard approach of inferring said traits from aggregate market data. Specifically, this dissertation examines the relation of personality traits, testosterone levels, and cortisol levels to financial choices and outcome under short-term (trading) and long-term (investing) investment horizons.

Subjects are recruited from advanced courses in finance at Florida International University. During the course of a semester (fourteen weeks) they complete a portfolio formation and rebalancing task, and answer a personality questionnaire. Additionally, subjects complete a series of trading simulations during the early morning of a preset date, and provide saliva samples. The saliva samples are analyzed for levels of testosterone and cortisol at a University lab facility. The relation of personality scores, testosterone levels, and cortisol levels to financial choices and outcomes is analyzed via linear regressions and Student’s t-tests.

The results show that personality factors associated with detrimental life quality, such as paranoia, are related to long-term investment decisions associated with increased portfolio risk and return. Additionally, the levels of testosterone and cortisol play a significant role in initial portfolio formation decisions, but not in subsequent portfolio allocation decisions. As such, the results show that hormone levels contribute to initial long-term investment choices, but personality traits play a much greater role in portfolio maintenance. Alternatively, the results show that testosterone and cortisol levels play a significant role in many aspects of short-term investment, including the decision to buy or to sell, and timing preferences. Overall, the results show that hormone levels and personality traits play significant and distinctive roles in many aspects of financial decision-making. Therefore, this dissertation provides important implications for the practice and the study of finance, including information that could be used to make more rational financial choices, and to develop financial models with more realistic assumptions about investor behavior.





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