A recent study from the University of St. Gallen, in Switzerland, led by forensics expert Pascal Scherrer and Thomas Noll, finds that professional stock traders actually outperform diagnosed psychopaths when it comes to competitive and risk-taking behavior.
According to the study’s authors, one contributing factor may be that stockbroker behavior is more reckless and manipulative than that of psychopaths. Researchers at the Swiss research university measured the readiness to cooperate and the egotism of 28 professional traders who took part in computer simulations and intelligence tests.
“Naturally one can’t characterize the traders as deranged, but for example, they behaved more egotistically and were more willing to take risks than a group of psychopaths who took the same test.”
Traders Need to Get More Than Their Opponents
Particularly shocking for Noll was the fact that the bankers weren’t aiming for higher winnings than their comparison group. Instead they were more interested in achieving a competitive advantage. Instead of taking a sober and businesslike approach to reaching the highest profit, “it was most important to the traders to get more than their opponents,” Noll explained. “And they spent a lot of energy trying to damage their opponents.”
Using a metaphor to describe the behavior, Noll said the stockbrokers behaved “as though their neighbor had the same car, and they took after it with a baseball bat so they could look better themselves.”
The researchers were unable to explain this penchant for destruction, they said.
They found that the traders showed a higher degree of competitiveness than the psychopaths — and that the traders were surprisingly willing to cause harm to their competitors if they thought it would bring them an advantage.
Scherrer and Noll are not the first to suggest a correlation between success on Wall Street and mental pathology. In 2005, a study found that traders who are unable to fully feel their emotions due to brain damage end up performing better on the market.
At the time, one professor of neurology described such emotionally impaired traders as “functional psychopaths.” Another research project that concluded in 1996 found that some percentage of both stockbrokers and politicians display many traits characteristic of psychopathic personality, including a willingness to take risks and an interest in wielding power.
And as Chris Barth at Forbes points out, Bret Easton Ellis was comparing stockbrokers with the seriously mentally ill as early as 1991, with his novel American Psycho.
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