Do Weather Parameters That Affect Our Mood Also Affect Stock Market Data?

Abstract

While the general acceptance in the 1970s was that investors acted rationally, the fact that investment decisions could not be explained only with a rational approach began to come to the fore in the early 1980s. Studies conducted in this context have diversified to examine the internal and external factors on the decision-making processes of individuals on investment. Opinions on investor behavior, which are fed by social sciences such as psychology, marketing, and sociology, have revealed that many factors are effective in the decision-making process. In this context, one of the most weighted elements in the decision-making literature is emotions. Emotions, which are directly related to different environmental conditions, have shown that they are also effective in investor decisions this way. This research was conducted to examine the effect of weather conditions on investment decisions. Data on multidimensional investment elements have been collected over a wide period and their relationships with different weather conditions have been examined. As a result, it has been concluded that the most important parameters of the investments, the transaction volume, and the transaction amount, are related to the pressure, temperature, and humidity of the weather. Similarly, transaction returns were also found to be related to air temperature.