Making Money When Others Lose Their Heads: Long-Term Strategies for Short-Term Panics
A rational investor's guide to crisis and opportunity.
It was late 2016 and a well-known hedge fund manager was probably staring at a chart that didn’t look pretty. The stock price of a once-beloved company had plummeted nearly 50% from its highs just a year earlier. News headlines were all notably negative, customer trust was in tatters, and most of the analysts were advising investors to stay far, far away from the stock.
The company was in the fast-casual dining sector, and it was known for its simple menu and commitment to fresh ingredients. But a series of food safety incidents, including outbreaks of E. coli, had brought the company to its knees. You know, customers were fleeing, sales were plummeting, and the brand that once was a revolution in fast food was now synonymous with health risks.
Back to our hedge fund manager. While others saw a sinking ship, he and his team dove deep into the company's financials, operations and market position, and emerged with a striking conclusion: the core of the business was still strong.
They had made some sound observations:
The food safety issues were fixable and not a fundamental flaw in the business model.
The company had a strong balance sheet with no debt.
There was significant potential for expansion, both in terms of store count and operational efficiency.
And finally, despite recent issues, the brand still resonated with consumers.
Armed with this conviction, they invested $1.2 billion, acquiring a 9.9% stake in the company. After this, they pushed for changes in the company's board and, in 2018, a new CEO was brought in. Look, the road to recovery was not smooth. But as the months turned into years, the signs of a turnaround became unmistakable.
By 2020, the stock price had more than tripled and this contrarian bet had paid off spectacularly.
If you follow the markets, you already may know whom I’m talking about. The fund manager was none other than Bill Ackman, and the company that had risen from the ashes none other than Chipotle Mexican Grill. You can see the stock chart below.
The story of Ackman's investment in Chipotle is a good introduction to today’s topic and shows the potential rewards of contrarian thinking, thorough analysis, and patience in the face of market pessimism. This example stands as a testament to the opportunities that can arise when quality companies face temporary, albeit severe, challenges – a true "bargain" hidden in plain sight.
In this article, I want to explore the fundamental reasons on why these opportunities are generated. Markets are complex, reflective systems where the price movement itself can enter feedback loops and possibly end up not reflecting on the fundamentals.1
Exaggerated reactions that depart from the underlying value justified by fundamentals can have their causes in events that are extrinsic and intrinsic to the company. So, I will divide the underlying reasons for these temporary market inefficiencies into structural market reasons and reasons inherent to the company.
I'll also provide an investment checklist with an incomplete list of both types of situations, so you can easily recognize them when they happen in the markets.
Finally, I'll explore the underlying psychological, sociological, and neurological causes behind the creation of these market inefficiencies.
Beyond the Crash: Structural Catalysts for Bargain Opportunities
I’ve written before about market crashes and how to react to this type of situations:
The best opportunities probably arise when the market suffers sharp declines. The years 2000, 2008, and 2020 are examples of this type of situation. In these cases, what generally happens is that fear takes over investors, leading them to sell everything: both good companies and bad ones, of course generating an interesting set of opportunities every time.
The advantage of crises is that everything generally declines simultaneously. Therefore, if you have a sharp decline in one position, it does not necessarily imply that something negative has happened to the company in which you have invested; rather, it is the result of widespread fear in the market, a situation that should stabilize sooner or later.
I must note that, during these crises, most of the capital that moves the stock market comes from funds and institutions. Between 70% and 80% of capital flows belong to these actors.2
So what happens during a crisis? A series of behaviors appear, somewhat irrational, that are not related to the real fundamentals of the companies. Since the managers of these funds have the responsibility of answering to their clients and, in many cases, these clients decide to withdraw their investments, the managers are forced to sell all their assets.
That’s one. There other "institutional behavioral biases" that also occur during crises. Let's see a few of them.
Institutional Pressures
As I mentioned earlier, fund managers are accountable to their clients, and may prioritize job security and commissions over generating the best returns in a purely rational manner3. Consequently, they often adopt strategies to closely track their benchmark and minimize volatility.
Fund clients tend to have a very short-term focus, and it's not uncommon for them to "fire" a fund due to underperformance over a mere six-month period4. This places immense pressure on managers to keep pace and stay close to the benchmark.
Technology has amplified these trends, increasing market volatility.
Collectively, these factors contribute to markets becoming less patient and less rational.
Additionally, there are other structural market reasons that create bargains, often related to specific market conditions that force funds to sell. Let’s continue.
Structural Arbitrage
When a company wants to divest a business unit, one way to do so is through a spinoff where this new unit is listed on the market and its shares are offered to the existing shareholders of the parent company.
If the spun-off entity is relatively small compared to the original company or its business is significantly different, many shareholders may not be interested in or able to hold these shares (due to restrictions within their fund mandates). Consequently, there's strong downward pressure on the share price during the initial weeks or months, driven by indiscriminate selling of the new company's stock.
If you are an individual investor who can independently assess the new company's merits, you can then decide whether to invest at potentially bargain prices.
One of the best sources to learn more about spinoff investing si Joel Greenblatt’s book, “You Can Be A Stock Market Genius”.
A clear example of a spinoff opportunity was the Shark Ninja (SN) spinoff from JS Global in 2023.
Shark Ninja, a well-known brand in the home appliance sector, was spun off from JS Global Lifestyle Company Limited, a Hong Kong-listed company, in September 2023. The spinoff was designed to unlock value by separating SN's faster-growing North American business from JS Global's other operations.
Initially, the spinoff faced significant selling pressure. Many of JS Global's original shareholders, particularly those based in Asia, were either unfamiliar with Shark Ninja's business or were unable to hold U.S.-listed shares due to their investment mandates. This led to a substantial drop in Shark Ninja's share price in the weeks following the spinoff.
Where investors loosing their heads? I don’t know. What I do know is that for investors who understood Shark Ninja's business model, market position, and growth potential, this presented a unique opportunity.
The company had strong brand recognition in North America, a track record of innovation in home appliances, and solid financial performance. Yet, due to the structural reasons surrounding the spinoff, it was temporarily undervalued by the market.
In the months following the spinoff, as the initial selling pressure subsided and more investors became aware of Shark Ninja's standalone value proposition, the stock price began to recover. This scenario illustrates how spinoffs can create temporary mispricings that astute individual investors can potentially capitalize on.
Another scenario involving forced selling by funds occurs when a company is removed ("delisted") from a major stock index like the Russell 2000 or the S&P 500.
This event triggers funds tracking the original index to indiscriminately sell the delisted company's shares, causing an artificial price drop unrelated to the company's fundamentals.
Bargain Hunting in Bear Territory: Oversold Sectors
Another scenario where structural market forces can generate attractive opportunities is when a particular sector or industry faces widespread investor aversion due to specific reasons that don't directly impact the earnings potential of the strongest companies within that sector.
A recent example is the energy and hydrocarbon sector, which experienced significant declines due to the "energy transition" trend. While the transition is inevitable, it will take years to fully materialize.
When a sector is broadly punished, all companies within it, regardless of their individual merits, tend to decline. Therefore, although you might find appealing "bargains," conducting a thorough analysis before investing is crucial.
JP Morgan's Guide to the Markets is an excellent resource for identifying asset classes that investors are currently avoiding.
Ok, so far I’ve mentioned structural market reasons that can lead to the creation of bargains. Now, let's delve into reasons inherent to the company itself. These situations often present the most lucrative opportunities, but you have to do a careful analysis to determine if the company's future profitability is truly affected.
Company-Specific Stock Plunges: Intrinsic Reasons For Bargain Formation
There are few certainties in investing, but one of them may well be that all companies will face problems at some point in time. This, as you may already anticipate, creates potential opportunities for discerning investors.
The type of problems a company faces, can be broadly categorized into operational, financial, and reputational issues. Probably you can come up with more categories, but this are general ones valid for a firs approach:
Operational challenges include the loss of key clients, technological disruptions that threaten business models, supply chain difficulties, and changes in consumer behavior.
Financial concerns might arise from government interventions, lawsuits, credit rating declines, or financial results that fall below market expectations.
Reputational factors such as high turnover in executive management, ethical scandals, or environmental issues can erode investor trust and lead to stock selloffs. Additionally, accounting irregularities or fraud allegations can severely impact investor confidence and stock valuations.
As investors, the key is always to distinguish between temporary setbacks and fundamental changes to a company's ability to generate future profits.
In the investment checklist below, I've included a list of reasons to help you further investigate and determine whether a particular situation impacts a company's ability to generate future profits.
An Investment Checklist To Profit From Market Overreactions
“In the fields of observation chance favors only the prepared mind.” -Louis Pasteur
The intersection between understanding the business and understanding the reasons behind a price drop is the ideal combination that any investor can learn to leverage the opportunities the market presents.
If you've done your homework understanding a company's business and one of the situations below occurs without affecting its profit-generating capacity, you might be witnessing a bargain in the making.
Extrinsic Reasons to Company
-General market fear during crises: Historical incidents such as the years 2000, 2008 and 2020 have shown that, when the market is assaulted by fear, investors tend to sell indiscriminately, affecting both good and bad stocks. This behavior is primarily driven by a general feeling of fear and not necessarily related to the fundamentals of individual companies.
-Mandatory sales by fund managers: Fund managers typically control a significant portion of the market's capital. In a crisis, the need to liquidate assets to meet customer withdrawals can put downward pressure on stock prices. This forced selling, regardless of the health of a company, leads to an artificial reduction in stock prices.
-Institutional behavioural biases: Fund managers often adopt strategies to closely track their benchmarks and reduce volatility due to the pressure of securing short-term performance and retaining their clients. This behavior, driven by technology and fear of poor performance, can lead to hasty decisions that do not consider the long-term potential of companies.
-Forced sale due to spinoffs: When a company decides to divest a business unit through a spin-off, the newly listed unit may not align with the interests or mandates of the parent company's institutional investors. This discrepancy can lead to a forced sale, pushing down the share price of the newly spun-off company, even if its fundamentals are strong.
-Forced sale due to delisting of important indices: When a company is delisted from a major stock index, funds that track the original index are required to sell the shares of the delisted company. This forced sale can lead to an artificial decrease in the share price, unrelated to the intrinsic value of the company.
-Sectors in “distress”: Sometimes sectors or entire industries fall out of favor with investors due to external factors. For example, as we all know, energy companies have faced challenges recently due to the increasing emphasis on the energy transition. This widespread negative sentiment toward an industry can drive down the stock prices of all companies within it, regardless of the individual health of the company.
-Geopolitical conflicts: Tensions or conflicts between countries can create uncertainty in the markets, often resulting in a sale of stocks due to fear and uncertainty.
-Changes in international capital flows: Massive movements of money between countries or regions can influence stock prices. If investors withdraw capital from a particular country or market due to economic or political concerns, this can put downward pressure on stock prices. Japan could be a recent example.
-Scale decisions: Changes in tax policies, such as the imposition of new taxes or the elimination of tax deductions for certain sectors, can influence investment decisions and therefore stock prices.Intrinsic Reasons to Company
-Government intervention: for example, when a new regulation is implemented that may affect the company's business (it happened with GoEasy when the Canadian government lowered the interest limit that these types of companies can charge for their loans).
-Lawsuit: Depending on the case, it may affect the ability to generate funds in the future.
-Accounting irregularities: If any news of this type arises, it is better to sell and then fully understand whether there was bad intention or not, and decide if we can trust the management team.
-Fraud allegations: evaluate whether the accusation is founded or not.
-Loss of a key client: Consider how important it was and whether the company will be able to replace those short-term profits with other sources of income.
-Technological changes: It happened recently with companies like Teleperformance, where it was questioned whether the business model could survive with the advent of Artificial Intelligence (the management team believes that, on the contrary, it will help them save costs).
-Credit rating reductions: The agencies in charge may consider that the company has worsened its ability to meet its future obligations. It is the investor's job to understand if this is really the case.
-Competitors' announcements: When a strong competitor makes an announcement, it can affect the stock price of other players in the industry. It happened with AutoZone when Amazon announced its entry into the auto parts market; AutoZone's stock suffered, but it was later shown that its "moat" would allow it to continue being a leader in the market, since auto parts have very particular characteristics. Once the fear had passed, the stock recovered significantly.
-Financial results below expectations: When a company releases quarterly or annual results that don't meet analyst forecasts, this can result in a drop in its stock price. These unmet expectations may be related to sales, profits, margins or any other relevant financial indicator and again, you must understand if it is permanent or temporary.
-Recall or issues with key products: If a product important to the company faces safety, regulatory issues, or simply becomes unpopular, this can negatively affect the perception of the company. An example could be a pharmacist who has to recall a medication due to unwanted side effects.
-High turnover in executive management: Frequent changes in key executive positions can be seen as a sign of instability or internal conflicts, which could generate distrust among investors.
-Disaster or crisis situations: Natural disasters, industrial accidents or any unforeseen event that affects the normal operation of the company can have a negative impact on its valuation.
-Difficulties in the supply chain: Problems in obtaining materials or interruptions in production can lead to delays or stops in the delivery of products, directly affecting income. A lot happened during the pandemic and in the following months, today most companies are almost recovered.
-Changes in consumer behavior: If consumers change their consumption habits and the company does not adapt quickly, it may lose relevance in the market. This can be a serious problem and it is key to understand whether the company will be able to adapt or not.
-Increase in production costs: An increase in raw material prices or labor costs can reduce a company's profit margins. Understand whether they are permanent or temporary cost increases.
-Ethical or reputational issues: Any scandal related to unethical practices, inappropriate treatment of employees or environmental problems can damage the company's reputation and, therefore, its stock market value.
-Intellectual property issues: If a company loses a major litigation over patents or intellectual property rights, this could affect its ability to operate or generate revenue normally.
-Questionable strategic decisions: If senior management makes decisions that the market perceives as not beneficial to the company in the long term (for example, an overpriced acquisition), this can negatively influence the share price.
-Lack of innovation: En highly competitive industries, the lack of innovative products or services can lead to a loss of market share.
-Failures in technological infrastructure: In today's digital world, a significant failure in technological infrastructure (such as a cyber attack) can have serious repercussions on the company's operation and reputation.
-Excessive executive compensation: A compensation structure that is perceived as too generous for senior management, especially if the company's results are not positive, can cause discontent among shareholders.
-Delays in key projects: If the company does not meet the expected deadlines for important projects or launches, this could raise questions about its ability to execute. Why Are Opportunities Created? Some Science-Based Explanations
So far, I've shared situations where market participants may overreact in light of market or company developments, creating opportunities to hunt for bargains. Now, let's explore why these opportunities arise. What are the roots of these prevalent human behaviors?
I'm going to draw explanations from three different disciplines: psychology, sociology, and neuroscience. After reviewing all the information, I hope you arrive at the same observations or conclusions as I did:
It's fascinating how the same or similar phenomenon is explained with different names in these three disciplines, and
After going through all the ways human cognition can be biased or tricked, I hope you agree with me that markets are never going to be perfectly efficient (unless some AGI takes over markets or well… something similar).
So, let’s begin with Psychology.
Market Psychology: How Cognitive Biases Create a Rationality Gap
When fear grips the market, investors —both professional and individual investors—tend to sell first and ask questions later. Market often assumes the worst-case scenario, but that’s not always the case.
As I consistently mention in this newsletter, a company's value is determined by its projected future profits over the next 20 or 30 years, discounted to their present value. If a company experiences lower profits during a specific year but then returns to its normal trajectory, its value should theoretically only decrease by 3% to 5%. However, this is rarely the case. Often, the stock plummets by 30% or 40%, sometimes even more, particularly for small-cap companies. This is a classic example of overreaction.
There are numerous psychological biases that contribute to these "irrational" movements, and while each one deserves its own in-depth discussion, I'll only touch on a few here, as this topic is frequently covered in financial literature:
Herding Behavior: This alone explain a lot of market behaviours. People tend to follow the crowd, leading to overreactions in both bull and bear markets. This can create bargains when the herd sentiment swings too far in one direction. For a concrete and interesting example, do a Youtube search with the keyword “elevator experiments”:
Recency Bias: Investors often give too much weight to recent events, potentially undervaluing stocks of good companies facing temporary setbacks.
Availability Bias: People tend to overestimate the probability of events that are easy to recall or where the information is easily available, which can lead to overreaction to dramatic news events.
Loss Aversion: The tendency to feel losses more acutely than equivalent gains can lead to panic selling during market downturns, creating potential bargains.
Negativity Bias: People tend to put more emphasis on negative experiences or information (bad news sell more than good news?). In the stock market, this can lead to an overreaction to bad news, potentially creating bargain opportunities.
Status Quo Bias: The tendency to prefer things to stay the same. This can cause investors to hold onto familiar stocks even when better opportunities arise elsewhere, potentially leading to misspricing.
Dunning-Kruger Effect: The cognitive bias in which people with limited knowledge or expertise in a given domain greatly overestimate their own knowledge or competence. In investing, this can lead to overconfidence among amateur investors, potentially creating market inefficiencies.
Ambiguity Aversion: Refers to the tendency of individuals to prefer known risks over unknown risks, even if the known risk is potentially more harmful or disadvantageous. This bias can create bargains as well, and I have written about it before:
Collective Delusions: A Sociological View of Market Inefficiencies
I always read about how cognitive biases from psychology explain a lot of irrational market behavior. But what about Sociology? At the end of the day, the market is a human collective construct, so let's explore how some concepts from this discipline can help explain bargain’s creation.
Information Cascades: This phenomenon occurs when individuals observe others' actions and make the same choice, regardless of their own private information. This is definitely related to herding behavior. Proposed by Bikhchandani, Hirshleifer and Welch, these three economist published a seminal paper in 1992 titled "A Theory of Fads, Fashion, Custom, and Cultural Change as Informational Cascades"5
Echo Chambers: This one is an interesting one, perhaps closely related to the “Confirmation Bias” but extremely reinforced in the age of social media, algorithms and personalized news feeds, where investors may be exposed to limited viewpoints that reinforce their existing beliefs. Contrarian investors step out of their echo chambers.
Social Proof: The tendency to view a behavior as correct in a given situation simply because we've seen others perform it. If a well-known investor buys or sells a stock, other investors might replicate the trade without conducting their own independent research, potentially leading to misspriced assets. Robert Cialdini was one of the main proponents of this concept in his book Influence6.
Institutional Isomorphism: The tendency of organizations in a field to become more similar over time. In the investment world, this can lead to homogeneity in strategies among institutional investors, potentially creating opportunities for those willing to deviate from the norm. DiMaggio and Powell were the ones who introduced and developed the concept of Institutional Isomorphism in their 1983 paper7.
Status-Seeking Behavior: Investors may make decisions based on enhancing their social status rather than on sound financial principles. This could lead to overvaluation of "prestigious" or “signalling” stocks and undervaluation of less glamorous but fundamentally sound companies.
Cultural Cognition: The tendency of individuals to form beliefs about societal dangers that reflect and reinforce their commitments to particular worldviews. In investing, this might manifest as systematic biases for or against certain types of companies or sectors based on cultural values. A classic example would be underinvesting in nuclear energy companies or technologies due to an irrationally heightened perception of the dangers. This may also be playing into the Availability Bias.
Social Mood Theory: Proposed by Robert Prechter, coincidentally known for his work in the Elliott Wave Principle, this theory suggests that social mood drives financial, macroeconomic, and political behavior, rather than the other way around. Prechter suggest that social mood is endogenous, not a reaction to events and that changes in social mood create trends in stock markets, pop culture, politics, and the economy. I think there's more to this theory and it deserves its own dedicated post. Maybe in the future, I'll delve deeper into it.
Narrative Economics: Finally, you have Narrative Economics. I didn’t know if I should include this one here, but since economics is a social science, I think it wouldn’t make any harm. Developed by Robert Shiller, this approach emphasize how popular narratives (stories, explanations, ideologies) can drive economic events. Recognizing dominant market narratives and their potential divergence from reality can help identify bargains. I believe that identifying the "dominant narrative" surrounding a stock is definitely a valuable skill for investors to develop.
So there you have it. There are many avenues to explore courtesy of social science. Let’s now delve into neuroscience.
The Neuroscience of Irrational Investing
I'm no Andrew Huberman, so I definitely had to do some research for this section. Nevertheless, I think there are some interesting takeaways from this discipline as well.
As we've been discussing, the idea is to look for mechanisms that contribute to explaining "irrational" behaviors that end up generating market inefficiencies and, consequently, bargains.
Amygdala Hijack8: The amygdala, part of the brain's limbic system, plays a important role in processing emotions, particularly fear and anxiety. In stressful market situations, the amygdala can override the prefrontal cortex (responsible for rational decision-making), leading to panic selling or impulsive buying. I believe Howard Marks would call this mechanism First-Level thinking.
Dopamine and Risk-Taking: On the opposite side, you have the neurotransmitter dopamine, central to the brain's reward system, that plays a significant role in risk-taking behavior. The anticipation of rewards (like potential gains) triggers dopamine release, which can lead to excessive risk-taking and contribute to market bubbles. Research in this field is fascinating, dopamine signalling is particularly sensitive to unexpected rewards so this can make speculative investments or high-risk strategies especially appealing when the mechanism is in play.
Hippocampus and Memory Formation: The hippocampus is important for forming new memories and learning from experiences. Stress can impair hippocampal function, leading investors to make the same mistakes repeatedly. Of course, we know this intuitively; it's hard to learn and remember things when we are stressed. But knowing there's an actual mechanism behind it can contribute to being more aware when this happens.
Decision Fatigue: Neuroimaging studies show that repeated decision-making depletes cognitive resources. This can lead to poorer quality decisions later in the day. The term "Decision Fatigue" was popularized by:
Roy F. Baumeister9.
Cortisol and Risk Aversion: Prolonged stress leads to elevated cortisol levels, which have been associated with increased risk aversion. During market downturns, this might contribute to excessive pessimism and undervaluation of assets. John Coates10 and Narayanan Kandasamy11 work has been instrumental in understanding how cortisol affect risk-taking behavior in financial markets.
Final Thoughts
The market's tendency to overreact creates opportunities for discerning investors.
Whether driven by structural market forces or company-specific issues, as you now hopefully understand, these overreactions stem from a complex interplay of psychological biases, sociological phenomena, and neurological processes.
Remember, similar to Bill Ackman's Chipotle investment, the most rewarding opportunities can emerge when high-quality companies experience temporary setbacks due to irrational market reactions.
In the end, market's inefficiencies are not flaws to be eliminated, but rather the very essence of what makes investing both challenging and rewarding. Hopefully now you’ll be able to make money when others lose their heads.
The concept of markets as reflective systems was popularized by legendary investor George Soros. According to Soros, in financial markets, participants act not only based on objective reality, but also based on their perception of reality. These perceptions, in turn, affect the underlying reality, which subsequently affects new perceptions. In other words, there is a feedback loop between the perceptions of market participants and the reality of the market. Given this reflective behavior, markets do not always accurately reflect the "true" underlying information or value, but are instead influenced by the perceptions, beliefs, and actions of market participants.
In 1950, 92% of the stocks in the United States corresponded to individual investors and 8% to investment funds. Today only ~30% corresponds to individual investors (the Federal Reserve's Flow of Funds data has consistently shown that institutional investors, including mutual funds, pension funds, and exchange-traded funds (ETFs), own a significant majority of U.S. corporate equities, often in the 70-80% range).
To Fire or Not to Fire? The Role of Job Security in Asset Management - UConn Finance Department: https://finance.business.uconn.edu/wp-content/uploads/sites/723/2020/01/JMP_Zhou_Job-Security-in-Asset-Management.pdf
Steps to Investing. (2023, August 3). Funds that underperform: When is it right to sell? Steps to Investing. https://stepstoinvesting.com/blog/funds-that-underperform-when-is-it-right-to-sell/
Bikhchandani, S., Hirshleifer, D., & Welch, I. (1992). A Theory of Fads, Fashion, Custom, and Cultural Change as Informational Cascades. Journal of Political Economy, 100(5), 992-1026 (This paper laid the foundation for the concept of information cascades and its relationship to herding behavior in economics and social sciences).
Cialdini, R. B. (1984). Influence: The Psychology of Persuasion. Harper Business.
DiMaggio, P. J., & Powell, W. W. (1983). The Iron Cage Revisited: Institutional Isomorphism and Collective Rationality in Organizational Fields. American Sociological Review, 48(2), 147-160.
The term "Amygdala Hijack" was coined by Daniel Goleman in Goleman, D. (1995). Emotional Intelligence: Why It Can Matter More Than IQ. Bantam Books.
Blain, B., Hollard, G., & Pessiglione, M. (2016). Neural mechanisms underlying the impact of daylong cognitive work on economic decisions. Proceedings of the National Academy of Sciences, 113(25), 6967-6972.
Coates, J. M., & Herbert, J. (2008). Endogenous steroids and financial risk taking on a London trading floor. Proceedings of the National Academy of Sciences, 105(16), 6167-6172.
Coates, J. (2012). The Hour Between Dog and Wolf: Risk Taking, Gut Feelings and the Biology of Boom and Bust. Penguin Press.
Kandasamy, N., Hardy, B., Page, L., Schaffner, M., Graggaber, J., Powlson, A. S., Fletcher, P. C., Gurnell, M., & Coates, J. (2014). Cortisol shifts financial risk preferences. Proceedings of the National Academy of Sciences, 111(9), 3608-3613.