Life and Shares

Humans aren't rational… and yet so much economic modelling assumes we are.

In this episode, we look at a Canadian experiment that investigated the 'gamification' of investment apps… and how one minor tweak to the app saw people increase the number of trades by a whopping 40%.

We meet behavioural finance specialists Angel Zhong (RMIT University) and Ravi Dutta Powell (The Behavioural Insights Team) who explain how cognitive biases impact how we assess risk and make investment decisions.

For the first two months of COVID, nearly 5,000 Australians opened an online trading account… every day. Eighty percent of them lost money.

So, is trading gambling? We speak with a clinical psychologist who's concerned about the lack of awareness and resources for people addicted to trading. We also speak with co-founder of the International Day Trading Academy Cameron Buchanan, who admits that while trading is gambling, he thinks there's an essential difference.

If video killed the radio star, have brokerage apps killed the stockbroker? What's the role of robo-advisers? And how are algorithms shaping the marketplace?

Did you know that the big players in financial services can pay to get "privileged access" to the ASX? We ask Paul Lajbcygier from the Monash Data Futures Institute, is that fair?

We also hear from UNSW Professor Gigi Foster who thinks greed and profit make the market go round – and that's not a bad thing. But on the other hand, she acknowledges there's a growing class of people who don't work for their wages – they just move their investments around.

Let's break down the jargon: starting with investor classifications.

Did you know that your level of wealth impacts how you can invest in the share market? In this episode, we hear from RMIT Associate Professor Chris Berg who thinks it's "deeply unethical" that retail investors ('mum and dad' investors) don't have access to the kind of products that rich people do and so are shut out of some of the most lucrative and risky investments… but accountants say there's a good reason for that.

We also learn about the murky areas of 'ethical' and 'sustainable' investing and how it differs from 'responsible' investing. If an Exchange Traded Fund (ETF) is labelled sustainable, is it irresponsible for it to have a large holding in a fossil fuel company? Is ESG reporting the best way to judge which companies are good to invest in?

Thinking about investing? Chances are, you're already playing the game. Life and Shares unpicks the share market so you can better understand how the system works.