Loss aversion has been shown to be an important driver of people’s investment decisions. Encouraged by regulators …, financial institutions are in search of ways to incorporate clients’ loss aversion in their risk classifications. The most … critical obstacle appears to be the lack of a valid measurement method for loss aversion that can be straightforwardly …

Purpose - The current study aims to investigate the impacts of two behavioral biases, namely, loss aversion and … overconfidence on the performance of US companies. First, the impact of loss aversion on the economic performance of companies was … study. Findings - It was documented that the loss-aversion bias negatively affects the economic performance of companies and …

Using detailed mutual fund holdings in the US market, we estimate active mutual fund managers’ loss aversion as a … function of both funds’ past performance and asset allocations. We document a substantial variation in loss aversion over time …. We further find managers' loss aversion is higher when past fund flows were high and lower when past fund flows were …

Assuming the loss aversion framework of Tversky and Kahneman (1992), stochastic investment and labour income processes …

allocation. Loss aversion per se is a relevant variable in explaining financial risk-taking. …

two-asset problem of the PT investor for one risk-free and one risky asset and find that loss aversion and the reference … focus on investors with PT preferences under different scenarios regarding the reference return and the degree of loss … aversion and compare their portfolio performance with the performance of investors under CVaR, risk neutral, linear loss averse …

prospect theory, we find that grit reduces loss aversion. By diminishing loss aversion, gritty investors exhibit a lower …

This paper studies the wealth and pricing implications of loss aversion in the presence of arbitrageurs with Epstein …-Zin preferences. Loss aversion affects an investor's survival prospects mainly through its effect on the investor's portfolio holdings …. Loss-averse investors will be driven out of the market and do not affect long-run prices if their portfolio positions are …

Myopic loss aversion (MLA) has been proposed as an explanation for the equity premium puzzle, and a number of …