Retail Investor Memory and Stock Market Expectations

Last registered on March 31, 2026
View Trial History

Pre-Trial

Trial Information

General Information

Title
Retail Investor Memory and Stock Market Expectations
RCT ID
AEARCTR-0018154
Initial registration date
March 17, 2026

Initial registration date is when the trial was registered.

It corresponds to when the registration was submitted to the Registry to be reviewed for publication.

First published
March 31, 2026, 9:31 AM EDT

First published corresponds to when the trial was first made public on the Registry after being reviewed.

Locations

Country
United States of America
Region

Primary Investigator

Name
ivo welch
Affiliation
ucla
Contact Primary Investigator

Other Primary Investigator(s)

Additional Trial Information

Status
In development
Start date
2026-03-17
End date
2026-08-01
Keywords
Finance & Microfinance
Additional Keywords
Investor expectations, memory, extrapolation, belief updating, survey experiment
JEL code(s)
Secondary IDs
Prior work
This trial does not extend or rely on any prior RCTs.
Abstract
This study investigates how U.S. retail investors’ recollection of past S&P 500 performance relates to their expectations of future performance. Using a Prolific survey, we elicit recalled returns (2025 and 2020–2025), forward-looking expectations (12-month and 5-year), and then reveal actual historical returns before re-eliciting expectations. The within-subjects pre/post design estimates how correcting memory shifts beliefs. Two between-subjects randomizations test (a) whether recalling past returns before forming expectations increases extrapolation, and (b) whether framing nudges on the information page differentially shift post-information expectations. The study is motivated by Jiang, Liu, Peng, and Yan (2025, QJE) and the Bordalo-Gennaioli-Shleifer memory framework.
External Link(s)

Registration Citation

Citation
welch, ivo. 2026. "Retail Investor Memory and Stock Market Expectations." AEA RCT Registry. March 31. https://doi.org/10.1257/rct.18154-1.0
Sponsors & Partners
Experimental Details

Interventions

Intervention(s)
none
Intervention Start Date
2026-03-17
Intervention End Date
2026-03-18

Primary Outcomes

Primary Outcomes (end points)

Variable Description Type
expect_12m_post − expect_12m_pre Belief update: 12-month expected return numeric (pp)
expect_5y_post − expect_5y_pre Belief update: 5-year expected annual return numeric (pp)
expect_12m_pre Pre-information 12-month expectation numeric (%)
expect_5y_pre Pre-information 5-year expectation numeric (%)
too_high_post vs. too_high_pre Shift in “too high” assessment categorical
others_expect_post − others_expect_pre Shift in perceived consensus numeric (pp)
Primary Outcomes (explanation)

Secondary Outcomes

Secondary Outcomes (end points)
Secondary Outcomes (explanation)

Experimental Design

Experimental Design
Just a survey on prolific
Experimental Design Details
Not available
Randomization Method

respondents are self-selecting on prolific. I see no demographic or other information about them. A random number generator randomizes further.

1. Order (50/50) — condition: recall_first vs expect_first — whether participants recall past returns before or after stating
their expectations.
2. Nudge (thirds) — nudge: none, extrapolate ("Many other people have extrapolated historical returns…"), or dividends
("Dividends…are near historical lows.")
3. Information on very recent stock returns (50/50 split, then further divided) — recency: half see all 4 time references together (all_pct or all_points), half see a single reference (one of yesterday, week_ago, month_ago, jan1 × pct/points), or none. This controls which S&P 500 performance data points are displayed on the info reveal page.
Randomization Unit
no
Was the treatment clustered?
No

Experiment Characteristics

Sample size: planned number of clusters
1000 (but could be more or less)
Sample size: planned number of observations
1000 (but could be more or less)
Sample size (or number of clusters) by treatment arms
1000 (but could be more or less)
Minimum detectable effect size for main outcomes (accounting for sample design and clustering)
no idea
Supporting Documents and Materials
IRB

Institutional Review Boards (IRBs)

IRB Name
UCLA
IRB Approval Date
2026-03-17
IRB Approval Number
IRB-26-0614
Analysis Plan