Financial market dips linked to seasonal depression

It’s no surprise to psychologist Lisa Kramer that financial market dips and crashes typically happen in the fall. People who experience seasonal depression shun financial risk-taking during seasons with less sunlight and are more willing to accept risk in spring and summer, according to her forthcoming study in Social Psychological and Personality Science. 

The experiment gave participants the option of putting some or all of their payment for the study into an investment with 50:50 odds where the potential gains exceeded the potential losses. Participants who experienced seasonal depression chose more of the guaranteed payments and put less money at risk in winter, but took more risks in summer.

The study, "This is Your Portfolio on Winter: Seasonal Affective Disorder and Risk Aversion in Financial Decision Making,” by Kramer and co-author Mark Weber, both of the University of Toronto’s Rotman School of Management, was advance published on July 18, 2011, in the online version of Social Psychological and Personality Science, co-published by SPSP.