Behavioral control, personality and simulated trading performance among novice investors

Building on research linking personality to financial behavior and market participation (Brown & Taylor, 2014; Conlin et al., 2015), this study examines whether personality traits influence simulated trading performance and whether this influence operates through trading intensity. The analysis is based on 133 second-year undergraduate students in Management Sciences who participated in a 4-hour stock market simulation involving CAC 40 stocks, real-time execution, transaction costs, and continuous ranking. The results show that the relationship between personality and performance is not uniform across the five OCEAN (openness, conscientiousness, extraversion, agreeableness, neuroticism) dimensions. Conscientiousness is the only trait associated with a statistically supported indirect pathway linking lower trading intensity to better performance. By contrast, openness is negatively associated with return, but not through the same channel. Our findings suggest that simulated trading performance is better understood through a behavioral mechanism linking personality, trading intensity, and return than through direct personality effects. This study contributes to the literature on investor behavior by showing that the effect of personality on trading performance is behaviorally differentiated and that, among novice investors, trading discipline constitutes a transmission channel between stable dispositions and simulated market outcomes.