Emotions and stock market anomalies: A systematic review

While it is known that emotions affect financial markets, there has been little collective examination of the literature in terms of identifying, for instance, which emotions, under what contexts, cause particular market impacts. We systematically review articles on emotions and finance (1989–2020), with particular emphasis on papers addressing emotions influencing stock-market anomalies, either directly, or indirectly through first engendering behavioral patterns. We summarize literature linking market anomalies to specific investor emotions, as well as identify directions for further research on the emotional behavior of investors. We also identify research trends and designs, as well as data collection and analysis techniques. Given the ongoing scholarly interest in emotions and markets, results should be of great interest.