In this study, we analyze whether volatility forecasts (judgmental confidence intervals) are influenced by the specific elicitation mode (i.e. whether forecasters have to state future price levels or directly future returns as upper and lower bounds). We present questionnaire responses of about...

The disposition effect describes investors’ common tendency of quitting a winning investment too soon and holding on to losing investments too long (Shefrin and Statman 1985). Our paper analyses individual level disposition effects using both account level field data as well as a controlled...

This paper describes a study, in which we examine the diversification behavior of financial advisors. The Asset Allocation Puzzle describes the phenomenon that popular financial advice tends to be inconsistent with the mutual-fund separation theorem. While Canner, Mankiw and Weil (1997) try to...

Anecdotal evidence and recent theoretical models argue that past stock returns affect subsequent stock trading volume. We study 3,000 individual investors over a 51 month period to test this prediction using linear panel regressions as well as negative binomial panel regressions and Logit panel...

This paper reports the results of experiments on portfolio choice in the presence of nontradeable income. The nontradeable income part could either be riskless or risky (background risk). In many cases, we observe behavior which is qualitatively consistent with the predictions of normative...

For a longer investment period investment consultants use to recommend a larger proportion of risky assets in investors' portfolios. In an experiment we examine the effect of different investment horizons on investors' risk behavior. We are interested both in the participants' risk perception...

The cost of information is an often ignored factor in economic situations although the information acquisition behavior of the decision makers has a crucial influence on the outcome. In this experiment, we study an information aggregation process in which participants decide in a random...

We analyze two recently documented follow-on purchase and repurchase patterns experimentally: Individual investors’ preference for purchasing additional shares of a stock that decreased rather than increased in value succeeding an initial purchase (pattern 1) and investors’ tendency for...

Empirical research has shown that a lower feedback frequency combined with a longer bind-ing period decreases myopia and thereby increases the willingness to invest into a risky asset. In an experimental study, we disentangle the intertwined manipulation of feedback frequency and binding period...

This paper summarizes issues and conclusions of a symposium on different aspects of business valuation which Prof. Weber and Prof. Wüstemann organized in January 2004 for accountants, lawyers, and judges. The central question has been whether the advertence of share prices in determining...