Format:
1 Online-Ressource (64 p)
Content:
We conduct a horse race of preferences to compare the predictive power and net effects of 15 types of preferences, such as attention, ambiguity aversion, loss aversion, probability overweighting, time preference, confidence, self-control, trust, and strategic reasoning, on actual investment decisions and outcomes. We estimate the net effects of the preferences by considering the correlations between the preferences. We find that for share of wealth invested in the stock market, the effect of confidence (Kyle and Wang, 1997) is stronger than that of risk aversion, which is stronger than the effects of self-control (Heidhues and Koszegi, 2010), loss aversion (Tversky and Kahneman, 1992), and ambiguity aversion (Dow and Werlang, 1992). For holding lottery-like stock, the effect of attention (Sims, 2003) is stronger than that of the discount rate, which is stronger than that of probability overweighting (Barberis and Huang, 2008). For share of lottery-like stock, the effect of strategic reasoning (Nagel, 1995) is stronger than that of probability overweighting. For wealth level, self-control has the strongest net effect
Note:
Nach Informationen von SSRN wurde die ursprüngliche Fassung des Dokuments June 11, 2020 erstellt
Language:
English
DOI:
10.2139/ssrn.3624937
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