Description
The paper examines the management of traders in financial markets from the perspectives of agency and prospect
theory. Using interview data from a sample of traders and managers in four investment banks, the paper argues that
managers focus on avoiding losses rather than making gains. This focus emerges from the characteristics of managers
and the nature of their role. The implications for agency and prospect theory, together with the policy issues for
managers, are discussed
doc_575120695.pdf
The paper examines the management of traders in financial markets from the perspectives of agency and prospect
theory. Using interview data from a sample of traders and managers in four investment banks, the paper argues that
managers focus on avoiding losses rather than making gains. This focus emerges from the characteristics of managers
and the nature of their role. The implications for agency and prospect theory, together with the policy issues for
managers, are discussed
doc_575120695.pdf