Health related research documents that air pollution has negative mood effects. Experimental works in psychology relate bad mood to increased risk aversion. Studies in financial economics report an observed link between mood effects and stock market returns. This study therefore investigates...

In a given period, a diversified fund, by virtue of being a weighted average, will perform somewhere in the middle range of its components' respective performances. This means that adaptive investors who look to the past to adjust expectations about future returns will shun diversified funds....