Past performance impacts financial judgments and willingness to sell more than types of fund, differences between professionals vs. lay people.

Behavioral finance and psychology literature consistently show that all investors are susceptible to cognitive biases when making investment decisions. However, their reliance on intuition varies with their level of expertise and funds' characteristics. In this pre-registered study, we compared professional investors (n = 74) and lay people (n = 244). Participants were presented with four investment funds in a within-subject design where past performance (i.e., positive vs. negative) and typology (i.e., socially responsible vs. traditional) were manipulated. We examined how expertise, the fund's past performance, and the type of fund influence participants' assessment of the funds (i.e., emotional reactions, perceived risk, and expected return) and their willingness to sell them. Our findings confirmed that lay people are more influenced by past performance and funds' characteristics when assessing their emotional reactions and the funds' risk and return, while expert investors' assessments remain relatively consistent across conditions. These patterns align with their behavioral intentions. Our results contribute to the understanding of investors' financial decision-making process and offer practical insights to establish better communication between professionals and their clients.