Document Detail


Foraging under conditions of short-term exploitative competition: the case of stock traders.
MedLine Citation:
PMID:  23363635     Owner:  NLM     Status:  MEDLINE    
Abstract/OtherAbstract:
Theory purports that animal foraging choices evolve to maximize returns, such as net energy intake. Empirical research in both human and non-human animals reveals that individuals often attend to the foraging choices of their competitors while making their own foraging choices. Owing to the complications of gathering field data or constructing experiments, however, broad facts relating theoretically optimal and empirically realized foraging choices are only now emerging. Here, we analyse foraging choices of a cohort of professional day traders who must choose between trading the same stock multiple times in a row--patch exploitation--or switching to a different stock--patch exploration--with potentially higher returns. We measure the difference between a trader's resource intake and the competitors' expected intake within a short period of time--a difference we call short-term comparative returns. We find that traders' choices can be explained by foraging heuristics that maximize their daily short-term comparative returns. However, we find no one-best relationship between different trading choices and net income intake. This suggests that traders' choices can be short-term win oriented and, paradoxically, maybe maladaptive for absolute market returns.
Authors:
Serguei Saavedra; R Dean Malmgren; Nicholas Switanek; Brian Uzzi
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Publication Detail:
Type:  Journal Article; Research Support, Non-U.S. Gov't; Research Support, U.S. Gov't, Non-P.H.S.     Date:  2013-01-30
Journal Detail:
Title:  Proceedings. Biological sciences / The Royal Society     Volume:  280     ISSN:  1471-2954     ISO Abbreviation:  Proc. Biol. Sci.     Publication Date:  2013 Mar 
Date Detail:
Created Date:  2013-01-31     Completed Date:  2013-06-28     Revised Date:  2014-03-25    
Medline Journal Info:
Nlm Unique ID:  101245157     Medline TA:  Proc Biol Sci     Country:  England    
Other Details:
Languages:  eng     Pagination:  20122901     Citation Subset:  IM    
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MeSH Terms
Descriptor/Qualifier:
Animals
Choice Behavior*
Commerce
Competitive Behavior*
Feeding Behavior*
Humans
Models, Biological
Comments/Corrections

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