Date of Award
Spring 5-16-2026
Document Type
Thesis
Degree Name
Bachelor of Arts (BA)
Department
Economics
First Advisor
Monica Das
Abstract
This study examines whether seasonal mood fluctuations that are driven by reduced daylight exposure in fall and winter months affect how retail investors respond to market risk. The study uses daily stock-level data from the Nasdaq Retail Trading Activity Tracker (RTAT) from 2016–2026. The study tests whether the relationship between market volatility (VIX) and retail investor sentiment (RTAT) differ during months associated with Seasonal Affective Disorder (SAD). The study uses a panel regression model with stock fixed effects and clustered standard errors with four different specifications. The results show that retail sentiment declines as VIX increases, however, during SAD months, this response is attenuated. The study also tests whether these findings can predict future returns; however, a return prediction model shows no significant relationship between stock returns and sentiment. This is consistent with efficient markets being able to self-correct for mood and behavioral shifts before they become exploitable patterns.
Creative Commons License
This work is licensed under a Creative Commons Attribution-Share Alike 4.0 International License.
Recommended Citation
Pace, Myles, "Seasonal Retail Investing Risk Aversion" (2026). Economics Student Theses and Capstone Projects. 196.
https://creativematter.skidmore.edu/econ_studt_schol/196