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Abstract

Background and aims

Personal investors decrease their stock market investment returns by trading frequently, which the behavioral finance literature has primarily explained via investors' overconfidence and low levels of financial literacy. This study investigates whether problem gambling can help account for frequent trading in a sample of active gambler/investors, as suggestive of frequent trading being in part driven by a behavioral addiction to gambling-like activities.

Methods

A retrospective cross-sectional study of 795 US-based participants, who reported both being active gamblers and holding stock market investments. Recollected stock trading activity (typical portfolio size, purchases and sales of stocks) was compared with scores on the Problem Gambling Severity Index, a financial literacy scale, and a measure of overconfidence.

Results

Self-reported relative stock portfolio turnover was positively associated with problem gambling scores. This association was robust to controls for financial literacy, overconfidence, and demographics, and occurred equally among investors of all self-reported portfolio sizes.

Discussion and conclusions

This study provides support for the hypothesis that behavioral addiction to gambling-like activities is associated with frequent stock market trading. New investment products that increase the ease of trading may therefore be detrimental to some investors.

Open access

Abstract

Background and aims: The UK allows a number of gambling products to be legally used by people under the age of 18. The aim of this study was to explore associations between recalled legal usage of five youth gambling products and adult disordered gambling. Methods: A retrospective cross-sectional study of 1,057 adult UK gamblers, aged 18–40. Recalled legal use of five youth gambling products (category D fruit machines, coin push machines, crane grab machines, the National Lottery, and National Lottery scratchcards) was correlated with adult disordered gambling symptoms as measured by the Problem Gambling Severity Index (PGSI). Results: Recalled rates of legal engagement with each product ranged from 50.9% for Category D fruit machines to 96.6% for coin push machines. For category D fruit machines, the National Lottery, and National Lottery scratchcards, merely having legally engaged with these products as a child was associated with adult disordered gambling. Furthermore, higher levels of recalled legal youth usage with each of the five products was also associated with adult disordered gambling. Discussion and conclusions: These results relate to recent government proposals to increase the National Lottery scratchcard legal age to 18, and add to a wider literature on youth gambling and subsequent gambling-related harm.

Open access
Journal of Behavioral Addictions
Authors:
Philip W.S. Newall
,
Lukasz Walasek
,
Rebecca Vázquez Kiesel
,
Elliot A. Ludvig
, and
Caroline Meyer

Abstract

Background and aims

Request-a-bet services are a modern gambling product delivered via the social network Twitter, which allow sports bettors to design custom bets. The public nature of Twitter data provided a unique opportunity to investigate patterns of bettor preference and the bookmaker profit margin in soccer, the UK’s favorite sport.

Methods

Two multi-method studies. Twitter users’ engagement with request-a-bet services was monitored unobtrusively (n = 1,406), meaning that potential patterns across users’ requests could be observed, and the bookmaker profit margin could be estimated. Twitter users were also surveyed directly (n = 55), providing self-report measures of request-a-bet usage.

Results

Twitter users requested bets with an average potential payoff of £56.5 per £1 risked (median = £9). Overall, 9.7% of requested bets paid-off, but these were mostly bets at short odds. This meant that requests yielded a high bookmaker profit margin of 43.7% (roughly eight times higher than current margins in conventional soccer bets), which increased to 74.6% for bets at longer odds. Requested bets also tended to involve star players from the best teams. Finally, 92.7% of surveyed Twitter users reported placing at least one bet via request-a-bet services (mean = 44.4 bets).

Discussion and conclusions

Researchers can use request-a-bet products to increase their understanding of sports betting behavior. Sports bettors should be given information about how much higher the bookmaker profit margin can be in modern sports bets compared to the conventional sports bets that they may be more familiar with.

Open access