

Boys Will Be Boys: Gender, Overconfidence and Common Stock Investment [pdf] - mhb
http://faculty.haas.berkeley.edu/odean/papers/gender/BoysWillBeBoys.pdf
<i>Modern financial economics assumes that we behave with extreme rationality; but, we do not. Furthermore, our deviations from rationality are often systematic. Behavioral finance relaxes
the traditional assumptions of financial economics by incorporating these observable, systematic, and very human departures from rationality into standard models of financial markets. Overconfidence is one such departure.<p>Models that assume market participants are overconfident yield one central prediction: overconfident investors will trade too much.
...<p>Men trade more than women and thereby reduce
their returns more so than do women. Furthermore, these differences are most pronounced between single men and single women.</i>
======
mhb
_Modern financial economics assumes that we behave with extreme rationality;
but, we do not. Furthermore, our deviations from rationality are often
systematic. Behavioral finance relaxes the traditional assumptions of
financial economics by incorporating these observable, systematic, and very
human departures from rationality into standard models of financial markets.
Overconfidence is one such departure. Models that assume market participants
are overconfident yield one central prediction: overconfident investors will
trade too much.

...

Men trade more than women and thereby reduce their returns more so than do
women. Furthermore, these differences are most pronounced between single men
and single women._

~~~
CalmQuiet
So: how might we generalize/extend this research to the benefit of HN readers?

Are startup/financing decisions also made more (too?) often by males than
females?

Or: might men be more likely to err on redirecting/retooling efforts and women
to err on the side of hanging in there when the going looks tough?

Even without any research, the one generalization that _might be worth_
considering for startups: some gender balance might provide useful perspective
on company directions.

