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How Emotions Influence Behavior in Financial Markets: A Conceptual Analysis and Emotion-based Account of Buy-Sell Preferences

Lookup NU author(s): Professor Darren DuxburyORCiD



This is the authors' accepted manuscript of an article that has been published in its final definitive form by Taylor and Francis , 2020.

For re-use rights please refer to the publisher's terms and conditions.


We develop a conceptual analysis and account of how emotions influence behavior in financial markets. To motivate our approach and to establish the need for such research, we first review the increasingly important literature on emotions in financial markets. While emotions influence investors in financial markets, there is a lack of precision concerning the exact nature of these influences. To remedy this, we identify and address a number of issues deriving from the current state of the finance literature. One issue concerns the lack of clarity in defining different emotion constructs. Another is the lack of a general emotion-based account of financial behavior. Our contribution is a classification of emotion-related phenomena and an emotion-based account of how anticipatory and anticipated emotions interact to determine investors’ buy and sell preferences in asset markets. Preliminary experimental results support our emotion-based account.

Publication metadata

Author(s): Duxbury D, Gärling T, Gamble A, Klass V

Publication type: Article

Publication status: Published

Journal: The European Journal of Finance

Year: 2020

Volume: 26

Issue: 14

Pages: 1417-1438

Online publication date: 19/03/2020

Acceptance date: 02/03/2020

Date deposited: 09/03/2020

ISSN (print): 1351-847X

ISSN (electronic): 1466-4364

Publisher: Taylor and Francis


DOI: 10.1080/1351847X.2020.1742758


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