"By employing leverage to gain more exposure to stocks when young, individuals can achieve better diversification across time. Using stock data going back to 1871, we show that buying stock on margin when young combined with more conservative investments when older stochastically dominates...

By employing leverage to gain more exposure to stocks when young, individuals can achieve better diversification across time. Using stock data going back to 1871, we show that early leverage combined with reduced equity exposure when older can reduce lifetime portfolio risk. For example, an...

Notwithstanding ERISA's fiduciary requirements, a significant portion of 401(k) plans establish investment menus with options that predictably lead to substantial underperformance of retirement portfolios. Utilizing data from more than 3,500 401(k) plans with more than $120 billion in assets, we...

This paper is no longer available on-line from the NBER. A revised version of the paper has been published as "Diversification Across Time" in the Journal of Portfolio Management 39 (Winter 2013), pp.73-86