Celebrating Success: Professor Darren Duxbury
Professor Darren Duxbury is quoted and his research features in a Risk.net piece examining recent advances in behavioural finance in the search for an edge in investing. Drawing directly on Professor Duxbury’s research the article notes: “One study1 found that investors tend to follow the market when buying but take a contrarian view when selling. Another2 showed the win-taking, loss-chasing “disposition effect” can be countered, in part, by the “house money” effect in which investors take more risk when on a roll.” Professor Duxbury is quoted in the article as saying, “While conventional wisdom sees cognitive biases as detrimental, evidence shows this need not always be the case, particularly when multiple biases may be at play.”
The two papers by Professor Duxbury referred to in the Risk.net piece are:
Duxbury, D., Hudson, R., Keasey, K., Yang, Z., & Yao, S. (2015). Do the disposition and house money effects coexist? A reconciliation of two behavioral biases using individual investor-level data. Journal of International Financial Markets, Institutions and Money, 34, 55-68. https://doi.org/10.1016/j.intfin.2014.11.004
Duxbury, D., & Yao, S. (2017). Are investors consistent in their trading strategies? An examination of individual investor-level data. International Review of Financial Analysis, 52, 77-87. https://doi.org/10.1016/j.irfa.2017.05.001
The Risk.net article is available here.