The Impact of Investors' Status and Information Presentation on Investors' Judgments*

Abstract

This paper examines the impact of investors' status (current, prospective) on their evaluation of information varying in valence (positive, negative) and in presentation mode (simultaneous, sequential). MBA graduates rated the relevance of positive and negative company information and the attractiveness of the company as an investment. Results indicate that, consistent with loss buffering, investors' investment attractiveness ratings are more favorable when negative and positive information are simultaneously (compared to sequentially) presented. Second, consistent with gain-savoring, investors' relevance and investment attractiveness ratings are more favorable when positive information is presented sequentially (compared to simultaneously) with other positive information. Third, consistent with multiple loss aversion, current (but not prospective) investors' relevance and attractiveness ratings are more favorable when negative information is presented sequentially (compared to simultaneously) with other negative information.