If you’re playing the stock market, you may want to stay away from scary movies. A new study suggests that horror movies can frighten investors into selling their stocks too soon.
The study, which was conducted by the University of California, Berkely, says that a person tends to project their emotions on other people. If a person is scared, they may believe that other people are scared. This “social projection” can heavily influence the decisions that people make.
Eduardo Andrade, an associate professor in the business school at the University of California, Berkeley, and co-author of the study, said:
“If I’m scared, I tend to project that you are scared. If I feel like selling, I project that you are also going to sell, and that pushes me to sell earlier rather than later in anticipation of a drop in stock value.”
Researchers conducted a study to see if a person was influenced by emotions unrelated to the stock market. US News reports that researchers had one group of people watch horror movies and another group of people watch documentaries. Then they asked the volunteers to participate in a mock stock market.
The study found that the people who watched horror movies were more likely to sell their stocks early. During the mock stock market test, that meant the people who watched horror movies lost more money.
Andrade said:
“Generally speaking, those who made more money were those who decided to stay longer in the simulation game.”
The study, which was published in the November issue of the Journal of Marketing Research, suggests that being able to control fear could be beneficial for investors.
Will this study keep you from watching horror movies in the future?
