Risk, return, and resonance: Symbolic considerations in everyday stock selection

How do retail investors choose which stocks to own? While finance models assume investors maximize risk-adjusted returns, and economic sociology has long argued that markets are culturally embedded, we lack systematic quantitative evidence on how symbolic considerations--values alignment, identity expression, and social ties--shape ordinary stock selection. Drawing on two original studies of U.S. retail investors, we estimate the relative importance of symbolic versus financial attributes in stated stock choice and examine how investors narrate attachment to stocks they actually own. Study 1, a choice-based conjoint experiment, shows that investors allocate roughly forty percent of their decision weight to non-financial attributes when these attributes are made salient, with values/identity alignment emerging as the third most important factor after expected return and risk. Study 2, a survey of stockholders, finds that investors report similar levels of identity attachment to a favored stock as to a favored consumer brand, which suggests that shares, just like consumer goods, are subject to symbolic consumption. Cluster analysis identifies three segments of investor self-understanding: financial-focused (37%), values/meaning-driven (47%), and socially-connected (16%). These findings show that symbolic considerations are not confined to spectacular cases such as meme stocks or ESG investing; they appear as measurable components of ordinary investments.