Investor Personality

An investor reviews their investment data using a smartphone in one hand while holding a cup of coffee in the other. In front of them is a laptop displaying additional data.

Who is likely to invest in the stock market? Who is likely to invest most successfully? Investor personality can provide insight about what kind of investments a person is likely to make.

World-renowned psychologist Adrian Furnham, PhD, professor at BI Norwegian Business School, recently joined our podcast, The Science of Personality, to speak about his latest research on investor personality.1

“Does personality influence partaking in the stock market? Yes,” Adrian said. “Is it mediated through a number of other factors? That will help us unpack when and why and how personality has an impact on stock market participation.”

Read on to learn more about how investor personality affects investment decisions, the personality characteristics of successful and unsuccessful investors, and who makes an ideal financial advisor.

How Investor Personality Affects Investment Decisions

Adrian has a longstanding research interest in people’s attitudes about money and use of money. Personality characteristics can affect financial literacy, which is the knowledge and skill associated with managing money.

While propensity for risk is an important psychological variable, financial literacy has many other factors. Recently, Adrian asked this research question: what are the demographic and personality variables that predict if people make stock market investments?

The Demographics of Stock Market Investors

Data from approximately 1,500 adults indicate four demographic variables that describe people who invest in the stock market: (1) sex, (2) age, (3) education, and (4) wealth. “A very large percentage of those who took part in the stock market were men,” Adrian said.

“It’s a big bias towards this particular group of educated, middle-aged, slightly wealthy, predominantly male people,” Adrian observed. From the perspective of evolutionary psychology, the prevalence of men among those who play the stock market could be explained by the exciting and addictive nature of investment. Whether they regard investing exclusively as recreation or a form of fun to grow their wealth, they probably choose to invest because they enjoy it.

The Personality of Stock Market Investors

Adrian’s research also yielded personality correlates of playing the stock market. Using Hogan Personality Inventory (HPI) terms, he described the profile of an investor personality:

  • High Adjustment – confident and likely to tolerate failure
  • High Ambition – motivated to compete against others
  • Low Interpersonal Sensitivity – direct and tough
  • High Prudence – likely to make organized, careful plans
  • High Inquisitive – curious and interested in research

“When you put these variables together, you could come up with a reasonable prediction of the people who will take part in the stock market and, in fact, the people who are more likely to succeed,” Adrian explained.

Characteristics of Successful Investors

The more financial literacy, capability, and knowledge someone has, the better they tend to perform in the stock market. Yet random chance and luck are part of investment. Unpredictable events can and do occur. Thus, a successful investor personality will also have a high tolerance for ambiguity.

Another characteristic beneficial to investors is a moderate sense of caution. Someone who is highly cautious might decide that stock market investment carries too much risk. Someone who is not cautious might seek a different form of investment, such as one with quicker rewards.

In the same way, a moderate amount of conscientiousness can predict how someone might invest in the stock market. Somewhat more conscientious people may opt for index funds, while somewhat less conscientious people might prefer to select their own stocks or trade more frequently.

Values and Investor Personality

Values affect whether we are likely to invest. Personality predicts attitudes toward money, and attitudes toward money are moderator variables for investments in the stock market. “If I see money as security, I’m less likely to take part in the stock market,” Adrian said. “If I see money as a way to power, I’m more so.”

Values also affect what stocks we are likely to invest in. Many people choose to invest in companies whose mission they simply want to support. Predictions about which products and companies are going to succeed will seem more persuasive to someone who already agrees with the brand’s values. “You’ve got not only whether this company is going to make money in the short term or the long term but also to what extent it fulfills your personal definition of ethics,” Adrian pointed out.

Characteristics of Unsuccessful Investors

Some variables in investor personality might make someone likely to participate in the stock market but also likely to be unsuccessful. One such characteristic is naïve optimism, or gullibility. Someone who believes they have special insight or luck might invest, continue to invest, or be persuaded to invest poorly.

Another attribute that can cause an investor to fail at the stock market is having a view that is too short-term. The stock market tends to reward delayed gratification. “It’s a long game. There can be ups and downs. You look for trends over time,” Adrian pointed out, joking that he considers himself too impulsive and impatient to be successful at taking part in the stock market.

Regarding the HPI Adjustment scale, attitudes toward success and failure also influence whether someone is likely to persist in investing. Adjustment measures resilience, the degree to which a person seems confident, self-accepting, and stable under pressure. Someone with a lower Adjustment score may become frustrated with failure and seek a less challenging endeavor. Someone with a higher Adjustment score is more likely to maintain effort during setbacks and remain self-confident. They tend to forget mistakes and remember victories.

Personality Characteristics of Financial Advisors

To those considering investing in the stock market for the first time, Adrian suggested focusing on certain personality characteristics when choosing a financial advisor. He offered key considerations in terms of HPI scales: Adjustment can indicate how people tolerate stress. Interpersonal Sensitivity can indicate how well they work with others and perform on a team. Prudence can indicate how methodically they approach making financial plans. Inquisitive can indicate whether they are curious and make informed decisions.

“You want people who react well to success and failure,” he said. “They’re prepared to put in the hard work and the analysis. They are inquisitive and open to all sorts of new opportunities and changes in this world. They have the ability to deal with others who they use for their decision-making.”

Listen to this conversation in full on episode 94 of The Science of Personality. Never miss an episode by following us anywhere you get podcasts. Cheers, everybody!


  1. Furnham, A., Cuppello, S., & Fenton-O’Creevy, M. (2024). Correlates of Stock Market Investment. Journal of Neuroscience, Psychology, and Economics. Advance online publication.