Born to Be a Trader? Fingers Point to Yes.

"I was astonished when I saw the results," Coates said. "I nearly fell off my chair at the strength of the correlation."

When the researchers looked at 14 of the traders in the original study, they found that those exposed to the most testosterone in the womb were the most likely to make more money on the days when the amount of the hormone in the blood was highest, indicating that their profitability was driven by their sensitivity to the hormone as well as the amount of it.

The researchers also found that those exposed to the most prenatal testosterone tended to make the most money on days when the market was most volatile and decisions had to be made especially quickly. That indicates that in addition to the hormone's tendency to boost confidence and increase the appetite for risk, the sheer mental ability enhanced by early testosterone exposure is probably a key factor. Earlier research had found that those exposed to higher prenatal testosterone as indicated by 2D:4D measurements tended to be better athletes and musicians.

Whatever the mechanism, the findings lend support for regulating the markets differently and perhaps changing the ways traders are paid to encourage less focus on short-term profits, the researchers said.

"This shows that irrational exuberance has catastrophic consequences, like the ones we are witnessing in these months, not because of the irrationality of the single trader but because of loose regulation of the market," Rustichini said. "If regulations allow, for example, assets like subprime mortgages that give high short-term profits, traders will chase them."

Other experts agreed.

"The better we can understand how fear and greed are represented in individuals and how they react to market circumstances, the more likely we are to be able to avoid crises of these sorts," said Andrew W. Lo, professor of finance at the Massachusetts Institute of Technology's Sloan School of Management.

But Coates warned against trying to use the findings to screen potential traders, saying it would be difficult to apply the findings to individual traders. And there are always exceptions. But Lo said that if the results are confirmed and other biological traits that affect behavior are identified, they could lead to screening tests for traders.

"At this point that's still science fiction, but at some point science fiction will become reality," Lo said.