Negative Affect Increases Risk-Aversion During Investment Decisions

Time and Location
Poster Session II - Board: II-052
Friday May 23, 2008, 8:00 AM - 9:00 AM
Exhibit Hall

Karen W. Kao
University of Michigan

Julie L. Hall
University of Michigan

Previous research indicates that negative affect promotes pessimistic judgments and choices. However, the specific mechanisms of how affect influences financial decisions are still not well understood. Using self-report measures of negative affect and a financial investment task, our study found that negative affect was associated with risk-aversion during investment choices.

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