Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/117334 
Authors: 
Year of Publication: 
2015
Series/Report no.: 
cege Discussion Papers No. 256
Publisher: 
University of Göttingen, Center for European, Governance and Economic Development Research (cege), Göttingen
Abstract: 
This paper experimentally studies the disposition effects of teams and individuals. The disposition effect describes the phenomenon that investors are reluctant to realize losses, whereas winners are sold too early. Our experiments compare the investments of two-person teams to a setting where investors trade alone. We find that subjects investing jointly exhibit more pronounced disposition effects than individuals. A closer look reveals that investor teams hardly realize losses and predominately sell winners. The data suggest that decision-dependent emotions may explain the differences. That is, teams reporting high levels of regret exhibit significantly higher disposition effects than individuals.
Subjects: 
Decision-dependent emotions
Disposition Effect
Experiment
Team Decision Making
JEL: 
C92
D70
G12
Document Type: 
Working Paper

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