The article in the UK issue of Wired, Jan-13 titled "Why Men Risk It All" refers to John Coates' research on psychology and risk taking. John Coates was a trader at Wall Street and is now a Senior Research Fellow in Neuroscience and Finance (Cambridge University).
The core of his hypothesis and challenging idea: testosterone the molecule of irrational exuberance and cortisol the molecule of irrational pessimism do control and manipulate our decisions significantly (but we thinks they are conscious processes).
That a lot of decisions are manipulated by signals of our body has been explored by sport physiologists who study the influence of hormones on athletic performance ...
The waves of irrational exuberance and pessimism that destabilise the financial markets may be driven by physiological changes taking place within traders as they make or lose money and as market volatility rises and falls, says John Coates.
And I ask myself, if we in the future will need to model (calibrate models to) Testosterone Skews or should financial risk decisions be left more to women?
