Elevated Testosterone Can Influence Bull Market Trading

Forget the Wolf of Wall Street, this study is looking at the bull. Michael Fitzsimmons/Shutterstock

To this day, stock market, or "bull market", trading floors are dominated by men. This chaotic arena of buying and selling stock, however, may be influenced by another, more subtle factor – testosterone.

“Testosterone, a chemical messenger especially influential in male physiology, has been shown to affect economic decision making, and is taken as a performance enhancer among some financial professionals,” the researchers write in their study. “This is the first experimental study to test how testosterone causally affects trading and prices.”


For the study, published in the upcoming journal Management Science, 140 male participants (market traders) were split into a testosterone or placebo gel group. They then worked 17 trading sessions where they purchased, sold, bid, and offered money for shares of stock. This “experimental market” acted as a simplified simulation of the professional platform. 

The team found that those given testosterone drove changes in market dynamics by increasing the bid, sell, and volume of a stock’s value. This was not seen in the placebo group. This decision-making behavior increased the size and persistence of stock market bubbles, eventually leading to dramatic crashes – despite the fact that the true stock values were known during the trading sessions. 

“We show that exogenously increasing testosterone in men increases bid prices and asset price bubbles, and slows the incorporation of fundamental value," said study author Amos Nadler of Ivey Business School in a statement. “We also show how the changes in buying and selling pressures give rise to bubbles and subsequent crashes.”

The reason for this spike in bid prices is yet to be determined, but survey data suggests that testosterone may affect beliefs and expectations towards future prices.


This, Nadler suggests, indicates the need to consider how biological factors can influence market decision making and capital risk. However, more research is needed to assess testosterone’s influence on behavior and to disentangle possible confounding factors.

It should be noted that the men increased their base level of testosterone to “high normal” levels, which doesn’t reflect their non-dosed decision making. Still, the team noted that the testosterone given was comparable with the normal range of variation for men of their age. The team hopes their findings spark further investigation into hormonal influences in decision making. 

Perhaps, then, there is a nugget of truth to what famed British economics expert Alfred Marshall once said: “The Mecca of the economist lies in economic biology rather than in economic dynamics.”


  • tag
  • decision making,

  • testosterone,

  • men,

  • stock market,

  • finance,

  • price bubbles,

  • bid prices