An analysis of the micro-blogging updates from investors posted on the social media site Twitter, offers an insight into the personality traits that are most closely linked to investment success. The research, published in the journal Global Business and Economics Review, suggests that successful investors predominantly exhibit two personality traits: emotional stability and openness. An additional finding is that all investors, successful or otherwise, have low agreeableness and do not exhibit extraversion.
Agreeableness and extraversion are two of the so-called Big Five personality traits. Added to those we have openness, conscientiousness, and neuroticism. They are a common archetype system for exploring personality. Individuals can have any combination of those five traits, each being positioned on a spectrum from a complete absence of said trait to predominance of that trait. So, a person might be an agreeable person who is mildly neurotic, strongly conscientious, extroverted, and a great deal of openness. Some traits are likely to be found to be strongly present with others.
R. Ramprakash and C. Joe Arun of the Loyola Institute of Business Administration (LIBA) in Chennai, India, selected a group of successful investors active on Twitter and performed an analysis of their tweets using linguistic inquiry and word count (LIWC) software. They hoped to reveal from their tweets common personality traits among successful investors. The work might provide clues to the inner workings of a world that always seems to be governed by whim and vagueries and does not succumb easily to analyses that might open up ways in which to predict how investments might rise and fall in a given time period. Opportunity and risk seem to be unknowable quantities, but insights into the personality of investors might add useful knowledge.
The researchers explain that while most research has focused on measuring the investment performance of individual investors and comparing that with their personality traits, the present study provides an interesting insight into the existing literature by identifying successful investors and observing their dominant personality trait, which, in turn, lead to specific behaviour.
Ramprakash, R. and Arun, C.J. (2022) ‘A study of the tweets of successful investors in order to identify their personality’, Global Business and Economics Review.
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