Archive | Investing

A new mechanism to explain how a financial crisis happens

Dr. KOBAYASHI Teruyoshi, an associate professor at the Graduate School of Economics, Kobe University and Dr. Charles Brummitt of Columbia University have proposed a new model to predict a financial crisis (a chain of bankruptcies) using a multiplex network model in which debts with different priorities are mutually held by banks. Their results were published […]

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Traders’ hormones’ may destabilize financial markets

The hormones testosterone and cortisol may destabilise financial markets by making traders take more risks, according to a study. Researchers simulated the trading floor in the lab by having volunteers buy and sell assets among themselves. They measured the volunteers’ natural hormone levels in one experiment and artificially raised them in another. When given doses […]

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Investment fears: How does the need for closure increase risk?

Logic would dictate that consumers receiving new market information would jump at the chance to adjust their investments accordingly. In practice, however, many people associate change with loss of control. They crave the idea of permanence or closure to such an extent that they would rather freeze decisions in place even if, ironically, this puts […]

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