Trader's Guts May Be More Important Than His Brains

According to a new study on interoception
By Michael Harthorne,  Newser Staff
Posted Sep 20, 2016 5:35 PM CDT
Traders Better at Listening to Their Gut Make More Money
A new study finds traders who are better at estimating their own heart rate make more money.   (AP Photo/Richard Drew)

When it comes to being a successful financial trader, it may be what's in your gut—not in your brain—that counts, according to a study published Monday in Scientific Reports. The study found that of 18 male traders studied, the ones who made the most money were also the best at estimating their own heart rate, a test of interoception, Bloomberg reports. Interoception is a person's sense of the signals his or her body is sending. "Our results suggest that signals from the body—the gut feelings of financial lore—contribute to success in the markets," AFP quotes researchers as saying. And it seems the more attuned someone is to those gut feelings, the better a trader he is.

The study found that not only are financial traders better at estimating their own heart rates than the general population—78.2% accuracy to 66.9% accuracy—but that the longer a person has been a trader, the better his sense of interoception. “It’s incredible that the market might be selecting for this,” John Coates, a neuroscientist and former trader, tells Bloomberg. “There’s this really powerful advantage in the market, and nobody knows about it.” And while there's still a question of causation, a similar study showed people with better interoception were also better at gambling, CNBC reports. That may be reason enough to start looking at the physiology, rather than the psychology, of good traders. (Here's why you should gamble on an empty stomach.)

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