It’s no surprise to behavioural finance expert Professor Lisa Kramer that financial market dips and crashes typically happen in autumn.
In her most recent study, Kramer – who teaches behavioural finance at the University of Toronto’s Rotman School of Management – shows that people who experience seasonal depression shun financial risk-taking during seasons with diminished daylight but are more willing to accept risk in spring and summer.
The work builds on previous studies by Kramer and others, suggesting seasonal depression may be sufficiently powerful to move financial markets.
“We’ve never, until now, been able to tie a pervasive market-wide seasonal phenomenon to individual investors’ emotions,” says Kramer.
