Second to fourth digit ratio and High Frequency traders' success

[polysena]

Second-to-fourth digit ratio predicts success among high-frequency financial traders

1. John M. Coatesa,b,1,
2. Mark Gurnellc,1 and
3. Aldo Rustichinid,1
   
   
   +Author Affiliations
   
   
   1. [url][/url]aDepartment of Physiology, Development, and Neuroscience, University of Cambridge, Cambridge CB2 3DY, United Kingdom;
   2. [url][/url]bJudge Business School, University of Cambridge, Cambridge CB2 1AG, United Kingdom;
   3. [url][/url]cDepartment of Medicine and Institute of Metabolic Science, University of Cambridge, Cambridge CB2 0QQ, United Kingdom; and
   4. [url][/url]dDepartment of Economics, University of Cambridge, Cambridge CB3 9DD, United Kingdom
      
      1. 
         
         
         Edited by Bruce S. McEwen, The Rockefeller University, New York, NY, and approved November 14, 2008 (received for review October 28, 2008)
      Abstract
      
      
      Prenatal androgens have important organizing effects on brain development and future behavior. The second-to-fourth digit length ratio (2D:4D) has been proposed as a marker of these prenatal androgen effects, a relatively longer fourth finger indicating higher prenatal androgen exposure. 2D:4D has been shown to predict success in highly competitive sports. Yet, little is known about the effects of prenatal androgens on an economically influential class of competitive risk taking—trading in the financial world. Here, we report the findings of a study conducted in the City of London in which we sampled 2D:4D from a group of male traders engaged in what is variously called “noise” or “high-frequency” trading. We found that 2D:4D predicted the trader's long-term profitability as well as the number of years they remained in the business. 2D:4D also predicted the sensitivity of their profitability to increases both in circulating testosterone and in market volatility. Our results suggest that prenatal androgens increase risk preferences and promote more rapid visuomotor scanning and physical reflexes. The success and longevity of traders exposed to high levels of prenatal androgens further suggests that financial markets may select for biological traits rather than rational expectations.
      
      
      • 2D:4D
      • neuro-economics
      • risk taking
      • market selection
      • testosteroneFootnotes
        
        • 1To whom correspondence may be addressed. E-mail: jmc98camacuk, mg299molebiocamacuk, or aldorustichinigmailcom
        • 
          
          
          Author contributions: J.M.C. designed and performed research; J.M.C., M.G., and A.R. analyzed data; and J.M.C., M.G., and A.R. wrote the paper.
        • 
          
          
          The authors declare no conflict of interest.
        • 
          
          
          This article is a PNAS Direct Submission.
        • © 2009 by The National Academy of Sciences of the USA
        
        
         
        
        
        
        Another of these weird bits of research...and would make recruiters job easier.. not to say that my ratio goes in favor of "failure"..

[FatChoi]

Could it be connected to this research from the same university?

[veroniq]

Dr Coates, who ran a trading desk for Deutsche Bank before moving to academia, denied that the research would lead to hiring on Wall Street and in the City being decided by “biomarkers” such as finger ratios.



“Population statistics such as ours give average effects over a population but can be tricky when applied to individuals,” he said.



Plus, Polysena, I always assumed you were female The research was about male traders. And the correlation with/ response to different hormones obviously differs a lot.

[polysena]

Gasp.. you are too rigorous Veroniq!:-)  



So dr. Coates was a trader? was he a biologist also? hmm otherwise Rusticchini is a game theory guy, and not clear what Gurnell is really.... so who knows biology in that group?



Based upon 49 traders observed.. .. arghh



That's what in my view qualifies for weird bits of research.. sic.



A part  from that I like their research.. it will help any girl now to locate the best potential partner ;-) just watch his fingers and jackpot- monie + high masculine drive.. (like there is no other way to find out..) pfff..

[tristanreid]

Isn't the latest pop-sci book from Gladwell about this sort of thing ('Outliers' or something like that)?

So if your finger ratio is average you probably won't amount to much of a trader, if it's high, you probably will be a good trader, and if it's extremely low you will be one of the best traders.



There's no denying it, it's SCIENCE! Big Smile



-t.

[polysena]

Yes this is Science



"Second-to-fourth digit ratio predicts success among high-frequency financial traders." By John M. Coates, Mark Gurnell, and Aldo Rustichini. Proceedings of the National Academy of Sciences, Vol. 106, No. 2, Jan. 13, 2009. ( abstract was free but article paying .. I hope it is better than newspaper coverage..)



 ... please do not miss this one



http://blog.wired.com/wiredscience/2009/01/financebiology.html



with a comment from a sensible person



"I remembering back in 2001 or 2002 a news story on the local Fox station saying that if a guy's ring finger was longer than his index finger he was gay. Are stock traders gay?Posted by: Garst | Jan 14, 2009 12:05:39 AM""

[AndyM]

Perhaps they would get the opposite result if they reran the numbers using updated P+Ls Confused



Honestly, what a crock of shit. I would imagine excess testosterone predicts success in traders very well...in a bull market.

[veroniq]

AndyM, this digit ratio is not about testosterone levels now, it reflects the fetal exposure to testosterone and estrogen.

Which has an effect on the whole range of male/female features and a lot more. There's actually a lot of research on this ratio as a marker for different things:

http://en.wikipedia.org/wiki/Digit_ratio



Fink et al (2004) found that men with low (indicating high testosterone) and women with high (indicating high estrogen) 2D:4D ratios express lower levels of facial symmetry .



*Looks in the mirror puzzled*

[Nonius]

that's pretty funny.

[pj]

> that's pretty funny.

Meaning Nonius's fingers are of the right length.