How does weather influence market returns and trading activity in Belgium ?
This study explores the influence of weather conditions on market returns and trading activity. It is assumed that meteorological parameters influence mood, which will in turn affect individuals when making investment decisions. Unlike the few behavioural finance studies on the subject, this work relies not only on market data but also on a sample of retail trading accounts to better capture heterogeneity across investors. The results reveal a significant influence of sunshine duration, precipitation quantity and temperature on financial markets.