Emotion and investment returns: Situation and personality as moderators in a stock market

Using a simulated stock investment system we examined the relationship between investors’ emotions and their investment returns, and the moderating effect of personality and situation in a stock market. Participants were undergraduate students from 6 universities. The results showed that: (a) investors’ positive emotions were positively correlated with investment returns in a market with a unilaterally rising price, and the moderating effect of extraversion was significant; (b) investors’ negative emotions were negatively correlated with investment returns in a market with a unilaterally falling price, and the moderating effect of neuroticism was significant.