Sunday, 30 August 2009

The sociology of financial markets

I took a punt on this book and it looks like it will be rather good. Just read the chapter 'Emotions on the trading floor' which has a lot of interesting stuff in it. No surprise to hear that emotions are a significant element of traders' involvement in markets, and what they enjoy about participation, and that newbies are keen to experience the most extreme market events.

There's a great table with a list of expressions traders use to describe feelings they experience in the market. Alongside the obvious sport/competition and combat/violence metaphors there are quite a lot of sexual ones. And there's a bit of speculation that this might be an expression of disconnection with the underlying economic reality. A good quote from a trader along these lines:
"You can't think about what each trade means financially... if you did you couldn't last."
It also made me wonder what kind of expressions might come up if you talked to institutional investors about ownership activity, and what kind of things they would consider good experiences.

ho hum. will no doubt be posting up a few chunks of text...

No comments: