Showing 1 - 10 of 18
The crisis of 2008 and 2009 exposed not only the shortcomings of our financial system but also the shortcomings of the tools used by financial advisors to assess and guide investors. These include risk questionnaires. Many investors who were assessed as risk tolerant in 2007 and assigned...
Persistent link: https://www.econbiz.de/10013036514
Fairness matters to financial advisors, whether fairness in financial markets or fairness in their relations with clients. Yet perceptions of fairness vary greatly and they are hotly debated everywhere, including politics, education, medicine, law, and finance. I explore fairness in finance in...
Persistent link: https://www.econbiz.de/10013037765
Cultural background affects the attitudes of immigrants long after they have settled in their new countries, and it affects the attitudes of their descendents as well. For example, levels of trust persist among immigrants to the United States, and relatively high levels of trust among immigrants...
Persistent link: https://www.econbiz.de/10013038523
Cultural background affects the attitudes of immigrants long after they have settled in their new countries, and it affects the attitudes of their descendents as well. For example, levels of trust persist among immigrants to the United States, and relatively high levels of trust among immigrants...
Persistent link: https://www.econbiz.de/10013140002
This study explores the links between culture and risk tolerance, based on surveys conducted in 23 countries. Altogether, more than 4,000 individuals participated in the surveys.Risk tolerance is associated with culture. Risk tolerance is relatively low in countries where uncertainty avoidance...
Persistent link: https://www.econbiz.de/10013140005
Typical risk questionnaires aimed at helping advisors guide investors are deficient in five ways. First, each investor has a multitude of risk tolerances, one for each goal and its mental account. Probes for one global risk tolerance miss that multitude. Second, the links between answers to...
Persistent link: https://www.econbiz.de/10013116401
Why were the returns of stocks with low book-to-market ratios and high market capitalization's lower, on average, than the returns of stocks with high book-to-market ratios and low market capitalization's? In this paper we pit the characteristics hypothesis against the affect hypothesis. The...
Persistent link: https://www.econbiz.de/10013148114
Why were the returns of stocks with low book-to-market ratios and high market capitalizations lower, on average, than the returns of stocks with high book-to-market ratios and low market capitalizations? In this paper we pit the characteristics hypothesis against the affect hypothesis. The...
Persistent link: https://www.econbiz.de/10013148705
Do stocks of admired companies yield admirable returns? Are increases in admiration followed by high stock returns? And how reliable is the relation between admiration and returns? These are the questions we answer in this paper. We study Fortune magazine's annual list of “America's Most...
Persistent link: https://www.econbiz.de/10013148708
Gaps between optimized portfolios produced by mean-variance optimizers and portfolios that investors prefer come from two sources. One is imprecise estimates of mean-variance parameters. The other is investor preferences beyond high expected returns and low risk. We offer the mean-variance...
Persistent link: https://www.econbiz.de/10013085515