Can you play the stock market just based on knowledge of human behavior?

It would be an interesting experiment to try. The vast majority of people are going off bad information, irrational hunches and specious theories anyway, so why not?

  • Is it sunny out? Awesome. “…stock trades from 26 exchanges around the world between 1982 and 1997 showed that profits were up 24.8% on unseasonably sunny days compared to cloudy days. Unseasonably sunny weather appears to elicit positive affect, which is then reflected in positive judgments.”
  • Sales of sex toys can be an economic indicator: “Market research in 2009 found that sales of lubricants and sexual-enhancement devices were rocketing in the recession… people need a cheap way to feel good in hard times (either that or they need a way to get hard in hard times).”
  • How is that soccer team doing? It could affect your portfolio. Did you country win the bid to host the Winter Olympic Games? Sell.
  • And as for your own behavior, never watch porn when you trade stocks. Bad idea.

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