Personality Traits and Susceptibility to Behavioral Biases among a Sample of Polish Stock Market Investors

Abstract

The aim of this paper is to investigate whether susceptibility to selected behavioral biases (overconfidence, mental accounting and sunk-cost fallacy) is correlated with the Eysenck’s [1978] personality traits (impulsivity, venturesomeness, and empathy). This study was conducted on a sample of 90 retail investors frequently investing on the Warsaw Stock Exchange. Participants filled out a survey made up of two parts: 1) three situational exercises, which assessed susceptibility to behavioral biases and 2) an Impulsiveness Questionnaire, which measures impulsivity, venturesomeness, and empathy. The results demonstrated the relationship between venturesomeness and susceptibility to all behavioral biases explored in this study. We find that higher level of venturesomeness was linked with a lower probability of all behavioral biases included in this study.