Listening to too much melancholic music on Spotify? You could be responsible for stock market crashing. No kidding! A new research has found a link between our collective musical moods and the performance of stock markets.
Next time you’re tempted to listen to Phoebe Bridgers, you may want to jam to Beyoncé instead – that is if you care about stock market returns. A study published in the peer-reviewed Journal of Financial Economics found that music curves can define how the market performs.
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Stock market performs better when you’re happy
When the general mood of Spotify users is leaning towards happy music, the stock market performs better. When we all dig deep into a hole of sad music, the market returns are lower for the next week.
If you don’t care for stock market, a return is the profit or loss incurred by you on an investment made on the stock market. This includes price changes of shares, interest, and additional payments from dividends.
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Also read: From Spotify To Apple Music: How Much Time It Takes To Earn $1 By Song Artists
Based on the assumption that people listen to music that fits their mood, the research suggests that music playing in one’s earbuds decides what stocks they’re likely to trade.
Radical changes in one’s mood and consequentially music sentiment was also found to have links with stock market volatility.
Also read: Spotify Is Testing Cheaper Subscription Plan To Woo More Customers
The study also found that positive music was associated with more cash flowing in and from financial assets while negative music was associated with more returns from government bonds – a tactic used by investors to minimise risk.
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If you invest in stock market, does music play a role in what happens with your money? Let us know in the comments below. For more in the world of technology and science, keep reading universo virtual.com.
References
When People Listen to Happy Songs, the Market Outperforms. (2021, December 14). Harvard Business Review.