The device, a prototype of which was unveiled this week, is an emotion-sensing system designed to help investors keep a cool head when buying and selling.
The idea was dreamed up by Philips, an electronics group based in the Netherlands, and the Dialogues Incubator, an initiative sponsored by ABN AMRO, a Dutch bank with intimate experience of rash decision-makers. Philips has been exploring emotion-sensing systems for a number of years, in part to see how electronic devices might help people cope with stress. ABN’s interest stemmed from research showing that day-traders who exhibit more intense emotional reactions to monetary gain or loss also have significantly worse trading results.
Although it is still under development, I honestly suspect that a device like this would actually stop an emotionally charged trader. When the emotions are high-- greed or fear, a device like this would quickly come unplugged.
I wonder if value investors would consider using something like this--- think of it as another layer of sanity check.
