Sapolsky, Robert M. 2004. Why Zebras Don’t Get Ulcers. New York:
Henry Holt and Company, p. 264.
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10. Schmid, R. E. 2004. “Researchers: Stress Causes Forgetfulness.” Asso-
ciated Press. October 28, 9:04 P.M. ET.
11. See note 4.12. Glaser, R., J. Rice, J. Sheridan, et al. 1987. “Stress-Related ImmuneSuppression: Health Implications.” Brain Behaviour and Immunity1: 7–20.
13. Shelton, S. E., J. D. Berard, and N. H. Kalin. 1997. “Aggression, fearand cortisol in young rhesus monkeys.” Psychoneuroendocrinology22: Supplement 2, S198. Presented at the International Society of Psy-choneuroendocrinology 28th Annual Meeting, San Francisco, Califor-nia, July.
14. Birnbaum, S. G., P. X. Yuan, M. Wang, et al. 2004. “Protein Kinase COveractivity Impairs Prefrontal Cortical Regulation of Working Mem-ory.” Science 306(5697) (October 29): 882–884.
15. See note 5.16. Lo, A., and D. Repin. 2002. “The Psychophysiology of Real-Time Finan-cial Risk Processing.” Journal of Cognitive Neuroscience 14: 323–339.17. Seligman, M., and S. Maier. 1967. “Failure to Escape Traumatic Shock.”
Journal of Experimental Psychology 74: 1–9.
Chapter 11: Love of Risk
1. Bennett, W. J. 1996. The Book of Virtues. New York: Simon & Schuster.2. Kumar, A. 2006. “Who Gambles in the Stock Market?” (July 11).AFA 2006 Boston Meetings Paper Available at SSRN: http://ssrn.com/abstract=686022.
3. American Psychiatric Association. 1994. Diagnostic and StatisticalManual of Mental Disorders, 4th ed. Washington, D.C.: American Psy-chiatric Association.
4. Franzen, H. 2001. “Gambling—Like Food and Drugs—ProducesFeelings of Reward in the Brain.” Scientiﬁc American Online,May 24. www.sciam.com/article.cfm?articleID=0004400A-E6F5–1C5E-B882809EC588ED9F.
5. Goudriaan, A. E., J. Oosterlaan, E. de Beurs, and W. van den Brink.2006. “Psychophysiological Determinants and Concomitants of Deﬁ-cient Decision Making in Pathological Gamblers.” Drug and AlcoholDependence, March 28.
6. Reuter, J., T. Raedler, M. Rose, et al. 2005. “Pathological Gambling IsLinked to Reduced Activation of the Mesolimbic Reward System.” Na-ture Neuroscience 8(2) (February): 147–148 (Epub January 9, 2005).7. Dodd, M. L., K. J. Klos, J. H. Bower, et al. 2005. “Pathological GamblingCaused by Drugs Used to Treat Parkinson Disease.” Archives of Neu-rology 62(9) (September): 1377–1381 (Epub July 11, 2005).
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8. Goudriaan, A. E., J. Oosterlaan, E. de Beurs, and W. van den Brink.2006. “Neurocognitive Functions in Pathological Gambling: A Compar-ison with Alcohol Dependence, Tourette Syndrome and Normal Con-trols.” Addiction 101(4) (April): 534–547.
9. Northoff, G., S. Grimm, H. Boeker, et al. 2005. “Affective Judgmentand Beneﬁcial Decision Making: Ventromedial Prefrontal Activity Cor-relates with Performance in the Iowa Gambling Task.” Human BrainMapping, December 21.
10. Potenza, M. N., H. C. Leung, H. P. Blumberg, et al. 2003. “An fMRIStroop Task Study of Ventromedial Prefrontal Cortical Function inPathological Gamblers.” American Journal of Psychiatry 160(11)(November): 1990–1994.
11. Green, J. 2003. “The Bookie of Virtue.” Washington Monthly (June).
www.washingtonmonthly.com/features/2003/0306.green.html.
12. Ibid.13. See note 1.14. Williams, R. J., and D. Connolly. 2006. “Does Learning about the Math-ematics of Gambling Change Gambling Behavior?” Psychology of Ad-dictive Behaviors 20(1) (March): 62–68.
15. Floyd, K., J. P. Whelan, and A. W. Meyers. 2006. “Use of Warning Mes-sages to Modify Gambling Beliefs and Behavior in a Laboratory In-vestigation.” Psychology of Addictive Behaviors 20(1) (March): 69–74.
16. Kim, S. W., J. E. Grant, D. E. Adson, and Y. C. Shin. 2001. “Double-blind naltrexone and placebo comparison study in the treatment ofpathological gambling.” Biological Psychiatry 49(11) (June 1): 914–921.
17. Grant, J. E., M. N. Potenza, E. Hollander, et al. 2006. “Multicenter Inves-tigation of the Opioid Antagonist Nalmefene in the Treatment of Patho-logical Gambling.” American Journal of Psychiatry 163(2) (February):303–312.
18. Di Chiara, G., and A. Imperato. 1988. “Opposite Effects of Mu andKappa Opiate Agonists on Dopamine Release in the Nucleus Accum-bens and in the Dorsal Caudate of Freely Moving Rats.” Journal ofPharmacology and Experimental Therapeutics 244: 1067–1080.
19. Jayaram-Lindstrom, N., P. Wennberg, Y. L. Hurd, and J. Franck. 2004.“Effects of Naltrexone on the Subjective Response to Amphetamine inHealthy Volunteers.” Journal of Clinical Psychopharmacology 24(6)(December): 665–669.
20. Dannon, P.N., K. Lowengrub, E. Musin E, et al. 2005. “Sustained-Release Bupropion versus Naltrexone in the Treatment of PathologicalGambling: A Preliminary Blind-Rater Study.” Journal of Clinical Psy-chopharmacology 25(6) (December): 593–596.
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Chapter 12: Personality Factors
1. Mauboussin, M. 2006. More Than You Know: Finding Financial Wis-dom in Unconventional Places. Chichester, England: Columbia Uni-versity Press.
2. Hagstrom, R. 1999. The Warren Buffett Portfolio.Hoboken, N. J.: John
Wiley & Sons.
3. Schwager, J. 2002. Stock Market Wizards. New York: HarperBusiness.4. Dictionary.com. 2006. “Personality.” Dictionary.com. http://dictionary.
reference.com/search?q=personality.
5. McCrae, R. R., and P. T. Costa, Jr. 1996. “Toward a New Generation ofPersonality Theories: Theoretical Contexts for the Five-Factor Model.”In J. S. Wiggins (ed.), The Five-Factor Model of Personality: Theoreti-cal perspectives New York: Guilford, pp. 51–87.
6. Caspi, A. 2000. “The Child Is Father of the Man: Personality Continu-ities from Childhood to Adulthood.” Journal of Personality and SocialPsychology 78: 158–172.
7. See note 5.8. Goldberg compiled these 300 questions into a new personality assess-ment tool, which he called the IPIP-NEO. John A. Johnson, a professorat Penn State University, posted Goldberg’s phrases online in 1996. Asof 2005, at least 175,000 people had answered the test items online.The ﬁve clusters remained consistent in others’ research as well Costa,P. T., Jr., and McCrae, R. R. 1992. “Normal Personality Assessment inClinical Practice: The NEO Personality Inventory.” Psychological As-sessment 4: 5–13.
9. Cohen, M. X., J. Young, J. M. Baek, et al. 2005. “Individual Differencesin Extraversion and Dopamine Genetics Predict Neural Reward Re-sponses.”Cognitive Brain Research 25(3) (December): 851–861 (EpubNovember 11, 2005).
10. Paulus, M. P., C. Rogalsky, A. Simmons, et al. 2003. “Increased Acti-vation in the Right Insula during Risk-Taking Decision Making Is Re-lated to Harm Avoidance and Neuroticism.” Neuroimage 19(4) (Au-gust): 1439–1448.
11. See note 5.12. Fox, N. A., H. A. Henderson, K. H. Rubin, et al. 2001. “Continuity andDiscontinuity of Behavioral Inhibition and Exuberance: Psychophysio-logical and Behavioral Inﬂuences across the First Four Years of Life.”Child Development 72:1, 1–21.
13. Arnold, P. D., G. Zai, and M. A. Richter. 2004. “Genetics of Anxiety Dis-orders.” Current Psychiatry Reports 6(4) (August): 243–254. Review.14. Sen, S., M. Burmeister, and D. Ghosh. 2004. “Meta-analysis of the As-sociation between a Serotonin Transporter Promoter Polymorphism
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(5-HTTLPR) and Anxiety-Related Personality Traits.” American Jour-nal of Medical Genetics. Part B, Neuropsychiatric Genetics. 127(1)(May 15): 85–89.
15. Zuckerman, M. 1974. “The Sensation-Seeking Motive.” In Maher, B.(ed.), Progress in Experimental Personality Research, vol. 7. NewYork: Academic Press, pp 79–148.
16. Zuckerman, M., and D. M. Kuhlman. 2000. “Personality and Risk-Taking: Common Biosocial Factors.” Journal of Personality 68:999–1029.
17. Grinblatt, M., M. Keloharju. 2006. “Sensation Seeking, Overcon-ﬁdence, and Trading Activity” (September 14). Working Paper.http://icf.som.yale.edu/pdf/seminar06–07/Grinblatt.pdf.
18. Cloninger, C. R., R. Adolfsson, and N. M. Svrakic. 1996. “Mapping Genes
for Human Personality.” Nature Genetics 12(1) (January): 3–4.
19. Golimbet, V. E., M. V. Alﬁmova, I. K. Gritsenko, and R. P. Ebshtein.2006. “[Dopamine System Genes and Personality Traits of Extraversionand Novelty Seeking].” Zhurnal vysshe˘ı nervno˘ı deiatelnosti imeni I PPavlova. 56(4) (July-August): 457–463. [Article in Russian].
20. Glassman, J.K. 2007. “Become a Better Investor.” Kiplinger’s Personal(January). http://www.kiplinger.com/magazine/
Finance magazine.archives/2007/01/glassman.html.
21. Durand, R. B., R. Newby, and J. Sanghani. 2006. “An IntimatePortrait of the Individual Investor” (March). Available at SSRN:http://ssrn.com/abstract=887441.
22. O’Creevy, F., M. N. Nicholson, E. Soane, and P. Willman. 2004. Traders:Risks, Decisions, and Management in Financial Markets. Oxford:Oxford University Press.
23. Steenbarger, B. 2003. The Psychology of Trading. Hoboken, N.J.: John
Wiley & Sons.
24. Hirschhorn, D. 2007. Personal email communication. (February 16).25. Lo, A., and D. Repin. 2005. “Fear and Greed in Financial Markets: AClinical Study of Day-Traders.” Presentation to the annual conferenceof the American Economics Association, Philadelphia, January.
26. Oberlechner, T. 2004. “Perceptions of Successful Traders by ForeignExchange Professionals.” Journal of Behavioral Finance 5(1): 23–31.27. Biais, B., D. Hilton, K. Mazurier, and S. Pouget. 2000. “Psychological
Traits and Trading Strategies.” Unpublished manuscript.
28. Goleman, D. 1998. Working with Emotional Intelligence. London:
Bloomsbury.
29. Schwager, J. 2003. Stock Market Wizards: Interviews with America’s
Top Traders. New York: HarperBusiness.
30. Soros, G. 1995. Soros on Soros: John Wiley & Sons.31. See note 1.
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32. Cymbalista, F. 2003. “George Soros: How He Knows What He Knows:Part 1: The Belief in Fallibility.” Stocks, Futures, and Options 2(7)(July).
33. Soros, G. 2000. Open Society: Reforming Global Capitalism. New
York: PublicAffairs.
Chapter 13: Making Decisions
1. Mauboussin, M. 2006. More Than You Know: Finding Financial Wis-dom in Unconventional Places. Chichester, England: Columbia Uni-versity Press, p. 26.
2. Loewenstein, C. K., G. F. Loewenstein, E. U. Weber, and N. Welch. 2001.
“Risk as Feelings.” Psychological Bulletin 2: 267–286.
3. See note 1.4. Miller, E. K., and J. D. Cohen. 2001. “An Integrative Theory of Prefrontal
Cortex Function.” Annual Review of Neuroscience 24: 167–202.
5. Breiter, H., I. Aharon, D. Kahneman, A. Dale, and P. Shizgal. 2001.“Functional Imaging of Neural Responses to Expectancy and Experi-ence of Monetary Gains and Losses.” Neuron 30: 619–639.
6. Knutson, B., G. W. Fong, C. S. Adams, and D. Hommer. 2001. “Dissocia-tion of Reward Anticipation versus Outcome with Event-Related fMRI.”NeuroReport 12: 3683–3687.
7. Knutson, B., C. S. Adams, G. W. Fong, and D. Hommer. 2001. “Antici-pation of Monetary Reward Selectively Recruits Nucleus Accumbens.”Journal of Neuroscience 21: RC159.
8. Knutson, B., G. W. Fong, S. M. Bennett, et al. 2003. “A Region of MesialPrefrontal Cortex Tracks Monetarily Rewarding Outcomes: Character-ization with Rapid Event-Related fMRI.” NeuroImage 18: 263–272.9. Ackert, L. F., N. Charupat, R. Deaves, and B. Kluger. 2006. “TheOrigins of Bubbles in Laboratory Asset Markets” (May). FRB of At-lanta Working Paper No. 2006–6 Available at SSRN: http://ssrn.com/abstract=903159.
10. Slovic, P., M. Finucane, E. Peters, and D. G. MacGregor. 2002. “The Af-fect Heuristic.” In Gilovich, T., D. Grifﬁn, and D. Kahneman (eds.), In-tuitive Judgment: Heuristics and Biases. New York: Cambridge Uni-versity Press, pp. 397–420.
11. Fox, C., and A. Tversky. 2000. “A Belief-Based Account of Decision un-der Uncertainty.” In Kahneman, D., and A. Tversky (eds.), Choices, Val-ues, and Frames. New York: Cambridge University Press and RussellSage Foundation, pp. 118–142.
12. Prelec, D. 1998. “The Probability Weighting Function.” Econometrica
60: 497–528.
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16. Wright, W., and G. H. Bower. 1992. “Mood Effects on Subjective Prob-ability Assessment.” Organizational Behavior and Human DecisionProcesses. 52(2): 276–291.
17. Loewenstein, G., and J. S. Lerner. 2003. “The Role of Affect in De-cision Making.” Handbook of Affective Science, ed. R. Davidson, H.Goldsmith, and K. Scherer. Oxford: Oxford University Press, pp. 619–642.
18. See note 1.19. See note 2.20. Ellsberg, D. 1961. “Risk, Ambiguity, and the Savage Axioms.” Quarterly
Journal of Economics 75: 643–669.
21. Kumar, A. 2006. “Valuation Uncertainty and Behavioral Biases,” May
31. Available at SSRN: http://ssrn.com/abstract=903820.
22. Bartov, E., P. S. Mohanram, and C. Seethamraju. 2001. “Valuationof Internet Stocks—an IPO Perspective” (April). Available at SSRN:http://ssrn.com/abstract=267928 or DOI: 10.2139/ssrn.267928.
23. Baker, M. and J. Wurgler. 2006. “Investor Sentiment and the Cross-Section of Stock Returns.” The Journal of Finance 61 (4): 1645–1680.24. MacGregor, D. G., P. Slovic, D. Dremen, and M. Berry. 2000. “Imagery,Affect, and Financial Judgment.” Journal of Psychology and FinancialMarkets 1: 104–110.
25. Francis, J., R. LaFond, P. M. Olsson, and K. Schipper. 2003. “Account-ing Anomalies and Information Uncertainty” (February). AFA 2004 SanDiego Meetings; EFA 2003 Annual Conference Paper No. 199. Availableat SSRN: http://ssrn.com/abstract=414141 or DOI: 10.2139/ssrn.414141.
26. See note 21.27. Rode, C., L. Cosmides, W. Hell, and J. Tooby. 1999. “When and Why DoPeople Avoid Unknown Probabilities in Decisions under Uncertainty?Testing Some Predictions from Optimal Foraging Theory.” Cognition72(3) (October 26): 269–304.
28. See Note 17.29. McDonald, H. E., and E. R. Hirt. 1997. “When Expectancy Meets Desire:Motivational Effects in Reconstructive Memory.” Journal of Personal-ity and Social Psychology 72: 5–23.
30. Camerer, C., and M. Weber M. 1992. “Recent Developments in Mod-elling Preferences: Uncertainty and Ambiguity.” Journal of Risk andUncertainty 5: 325–370.
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32. Deppe, M., W. Schwindt, J. Kramer, et al. 2005. “Evidence for a NeuralCorrelate of a Framing Effect: Bias-Speciﬁc Activity in the Ventrome-dial Prefrontal Cortex during Credibility Judgments.” Brain ResearchBulletin 67(5) (November 15): 413–421 (Epub July 25, 2005).
33. Holm, H., and P. Nystedt. 2005. “Intra Generational Trust: A Semi Ex-perimental Study of Trust Among Different Generations.” Journal ofEconomic Behavior and Organization 58: 403–419.
34. Sanfey, A. G., J. K. Rilling, J. A. Aronson, et al.2003. “The Neural Ba-sis of Economic Decision-Making in the Ultimatum Game.” Science300(5626) (June 13): 1755–1758.
35. Winston, J. S., B. A. Strange, J. O’Doherty, and R. J. Dolan. 2002. “Au-tomatic and Intentional Brain Responses during Evaluation of Trust-worthiness of Faces.” Nature Neuroscience 5(3) (March): 192–193,277–283.
36. Insel, T. R., Shapiro, L. E. 1992. “Oxytocin receptor distribution reﬂectssocial organization in monogamous and polygamous voles.” Proceed-ings of the National Academy of Sciences. 89(13) (July 1): 5981–5985.37. Zak, P. J., R. Kurzban, and W. T. Matzner. 2004. “The Neurobiology ofTrust.” Annals of the New York Academy of Sciences 1032 (December):224–227.
38. Zak, P. J., R. Kurzban, and W. T. Matzner. 2005. “Oxytocin Is Associated
with Human Trustworthiness.” Hormones and Behavior 48: 522–527.
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Chapter 14: Framing Your Options
1. Shlosser, Eric. 2001. Fast Food Nation. New York: Houghton-Mifﬂin.2. Personal communication with Camelia Kuhnen, September 30, 2006.3. Shefrin, H. M., and M. Statman. 1985. “The Disposition to Sell WinnersToo Early and Ride Losers Too Long: Theory and Evidence.” Journalof Finance 40, 777–792.
4. Kahneman, D., and A. Tversky. 1979. “Prospect Theory: An Analysis of
Decision under Risk.” Econometrica 47: 263–291.
5. Ariely, D. 2002. University of California at Berkeley, Psychology and
Economics Spring Seminar.
6. De Martino, B., D. Kumaran, B. Seymour, and R. J. Dolan. 2006. “Biases,and Rational Decision-Making in the Human Brain.” Science 313(5787)(August 4): 684–687.
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7. Vergano, D. 2006. “Study: Ask with Care: Emotion Rules the Brain’s
Decisions.” USA Today, August 7. pp. D4.
8. Ibid.9. Locke, P. R., and S. C. Mann. 2000. “Do Professional Traders Ex-hibit Loss Realization Aversion?” (November). Available at SSRN:http://ssrn.com/abstract=251942 or DOI: 10.2139/ssrn.251942.
10. Odean, T. 1998. “Are Investors Reluctant to Realize Their Losses?”
Journal of Finance 53(5) (October): 1775–1798.
11. Coval, J. D., T. Shumway. 2005. “Do Behavioral Biases Affect Prices?”
Journal of Finance. 60(1) (February).
12. Brown, S., D. R. Gallagher, O. W. Steenbeck, and P. L. Swan. 2004. “Dou-ble or Nothing: Patterns of Equity Fund Holdings and Transactions.”Working paper, New York University. Current Draft: May 1, 2005.13. Genesove, D., and C. Mayer. 2001. “Loss Aversion and Seller Behavior:Evidence from the Housing Market,” MIT Press, Quarterly Journal ofEconomics, 116(4) (November): 1233–1260.
14. Heath, C., S. Huddart, and M. Lang. 1999. “Psychological Factorsand Stock Option Exercise.” MIT Press, Quarterly Journal of Eco-nomics114(2) (May): 601–627.
15. See note 7.16. Weber, M., and F. Welfens. 2006. “An Individual Level Analysis ofthe Disposition Effect: Empirical and Experimental Evidence” (May).Available at SSRN: http://ssrn.com/abstract=889303.
17. Ibid.18. Ibid.
Chapter 15: Loss Aversion
1. Schwager, J. 2002. “Wizard Lesson #14.” Stock Market Wizards: Inter-views with America’s Top Stock Traders. New York: John Wiley &Sons.
2. Fogel, S. O., and T. Berry. 2006. “The Disposition Effect and IndividualInvestor Dec