April 1, 1999


This weekend, when Canadians are putting their clocks forward one hour they probably won't be thinking about their stocks..but perhaps they should.
A trio of researchers has found strong evidence for unusual declines in stock market returns on the Monday after daylight savings time begins and on the Monday when it reverts back to standard time.
SFU associate professor in economics Mark Kamstra, SFU business administration adjunct professor Lisa Kramer and UBC professor Maurice Levi recently completed a study examining stock market returns on those days.
Kamstra says daylight savings Mondays show returns that are four times more negative than every other Monday during the year.
He and his colleagues began the study after learning of UBC professor Stanley Coren's research into sleep deprivation, which shows that physical capital losses amount to $60 billion in the U.S. on each of the two Mondays after the clocks are changed.
"We wondered whether, if there were some kind of systematic sleep desynchronosis, we might feel this effect in financial markets," says Kamstra. Sure enough, he says, stock market returns on those two Mondays also showed losses of close to $60 billion in the U.S. on the NYSE.
Kamstra postulates that people whose sleep routines have been disrupted are perhaps more nervous than usual and therefore more averse to making decisions that involve risk. The result? "If you feel a little less confident in yourself, you may be willing to pay a little less for something that's a risk."


CONTACT: Mark Kamstra, 291-4514, 899-4333


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