Science

Cows match the performance of human stock analysts in Norwegian experiment 


Cows that ‘picked’ stocks by defecating on a grid of 25 different company names matched the performance of expert stock analysts in Norwegian experiment

  • A three-month experiment tracked the stock picks of cows, brokers, and others
  • Cows’ stock picks were entered by noting where they defecated on a field
  •  The field was divided into a five-by-five grid with different company names
  • The picks from the cows and the expert brokers earned the same returns

A group of cows matched a team of professional stock market analysts in a test to see whose picks could generate the best returns on the Norwegian stock market.

The experiment was conducted on the Norwegian television program Økonomiekspertene, which set out to investigate just how much benefit there was in expert investing advice.  

The producers picked two Norwegian stock analysts, an astrologist, a pair of beauty bloggers, and a group of five cows. 

The Norwegian television program Økonomiekspertene ran a three-month experiment tracking the stock picks of expert stockbrokers, beauty bloggers, an astrologer, and a group of four cows

The Norwegian television program Økonomiekspertene ran a three-month experiment tracking the stock picks of expert stockbrokers, beauty bloggers, an astrologer, and a group of four cows

Each group was given the equivalent of $1,222 (or 10,000 crowns), and were allowed to choose any number of stocks from the OBX index, which tracks the top 25 companies on the Oslo Stock Exchange. 

The investments were held for three months and then sold off to see who had brought in the biggest return on their investment, according to a report in The Financial Times.

Since the cows couldn’t actually make selections, they were led onto a grass field with a five-by-five grid showing the 25 different companies.

When the cows defecated on a particular grid square, the team recorded the company painted in it as an official pick.

The cow’s picks were the engineering firm Aker Solutions, the state energy company Statoil, the private energy company Fred Olsen Energy, and Schibsted, a digital publishing company.

While other teams were allowed to invest different amounts of money into different companies to get better returns, the cows’ money was divided evenly between their four ‘selections.’

The cows' stock 'picks' were determined by marking which company their defecation landed next to

The cows’ stock ‘picks’ were determined by marking which company their defecation landed next to

The expert stock brokers (left) outperformed a Norwegian stock index by 2.8 percent, the astrologer (center) came in slightly below the stock indexes returns, and the beauty bloggers came out ahead of everybody, more than 5 percent ahead of the index.

The expert stock brokers (left) outperformed a Norwegian stock index by 2.8 percent, the astrologer (center) came in slightly below the stock indexes returns, and the beauty bloggers came out ahead of everybody, more than 5 percent ahead of the index.

The cows basically did as well as the stock brokers and outperformed the Oslo stock index by 2.6 percent over three months

The cows basically did as well as the stock brokers and outperformed the Oslo stock index by 2.6 percent over three months

The astrologer made his selections based around the fact that it was the year of the goat in the Chinese calendar, while the beauty bloggers said they didn’t recognize any of the company names on the list.

Instead, they picked based on how well they liked the sound of the company name, settling on the seafood company Marine Harvest and the cruise line Royal Caribbean.

At the end of the three month period, three of the four groups had outperformed the five percent return from OBX index.

The beauty bloggers performed best with a 10 percent return, while the stockbrokers and the cows got basically the same results, with a 7.26 percent return and a 7.28 return respectively.

The astrologer was the only participant who underperformed the OBX, with a sub-five percent return. 

WHAT OTHER ANIMALS HAVE BEEN USED IN STOCK EXPERIMENTS?

In 2018, researchers in the UK had a cat named Orlando pick stocks by dropping a toy mouse on a grid of stocks. Orlando outperformed both a team of students and stock brokers. 

In 2015,  a researcher in New York recorded stock picks from a group of lab rats, who made their selections based on specific musical queues that indicated whether a stock was rising or falling. 

In 2010, a Russian chimpanzee named Lusha outperform 94 percent of the stock analysts in the country over a three year period. She made her picks after being presented with a group of toy cubes with different company names on them. 

In 1999, a Swedish artist turned a yucca plant in his apartment into a stock advisor, hooking its stem and leaves up to a set of electrodes that would convert the plant’s energy signals into picks., which provided an 18 percent return over a period of 16 months. 

 



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