Weather, and the mood it creates among investors, may influence short-term stock returns, according to a forthcoming paper in the Review of Financial Studies. Harvard Law School's corporate governance blog has a post from four professors — William Goetzmann of Yale, Dasol Kim of Case Western Reserve, Alok Kuma of the University of Miami, and Qin Wang of the University of Michigan at Dearborn — explaining the dynamic: "sunnier days are associated with optimistic responses related to stock mispricing...sunnier days are associated with increased buying propensities of institutional investors."
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