Value of Full-service Brokers?
Do individual investors truly benefit from using full service brokers? In the February 2011 draft of their paper entitled “What is the Impact of Financial Advisors on Retirement Portfolio Choices and Outcomes?”, John Chalmers and Jonathan R...
Stated Beliefs Versus Trading Behavior
Do individual investors actually trade on their stated beliefs? In their February 2011 paper entitled “Do Investors Put Their Money Where Their Mouth Is? Stock Market Expectations and Trading Behavior”, Christoph Merkle and Martin Weber com...
Stated Beliefs Versus Trading Behavior
Do individual investors actually trade on their stated beliefs? In their February 2011 paper entitled “Do Investors Put Their Money Where Their Mouth Is? Stock Market Expectations and Trading Behavior”, Christoph Merkle and Martin Weber compare quarterly risk and return expectation survey responses to actual trading data and portfolio holdings for a group of self-directed...
Get Genetic Screening for Your Financial Advisor?
What accounts for the persistence in diversity of investor beliefs and behaviors? Why does logical inference from common data not drive common attitudes and actions? In their March 2011 paper entitled “Serotonin and Risk Taking: How Do Genes Chan...
Performance of Emerging Markets ETFs
Do emerging markets exchange-traded funds (ETF) reliably track and on average achieve the returns of benchmark indexes? In their February 2011 paper entitled “Evaluating the Performance of Global Emerging Markets Equity Exchange-Traded Funds̶...
Distribution of OTC Stock Returns
Do stocks trading on Over-the-Counter (OTC) markets, generally off limits for institutional traders, present in aggregate a good opportunity for individual investors? In their December 2010 paper entitled "Do Investors Overpay for Stocks with Lottery-L...
Dollar-weighted Returns for Equity Investors [PREMIUM]
A reader interested in the gap between time-weighted equity returns and actual dollar-weighted returns experienced by investors flagged critiques of prior studies described in: "Returns for Investors (Rather Than Markets)": "...the actual aggregate (ti...
A Few Notes on What Investors Really Want
Author Meir Statman states that his 2010 book What Investors Really Want "is about what we want from our investments. It is about how we think about our investments, how we feel about them, and how investment markets drive us crazy as we try to cajole ...
Reference Price Adjustments for Winners and Losers
Do investors think differently about winning and losing positions? In their paper entitled "Why Do Investors Update Reference Prices Asymmetrically?", Susan Grant, Ying Xie and Dilip Soman conduct four laboratory experiments to investigate differences ...
Leverage Stock Investments While Young? [PREMIUM]
Should long-term investors view their retirement portfolios more like houses than savings plans? In other words, should they start out with considerable leverage and draw the leverage down gradually over time? In their October 2010 paper entitled "Dive...
Seeking Confirming Opinions Rather Than Information?
...experimental evidence indicates that participation in stock message boards/forums increases a typical investor's propensity to trade and decreases actual investment performance. Investors may want to factor this effect into their information search and processing practices.
Investors Playing the Lottery Instead?
How much individual investing is lottery-like, just hoping for a big score with no analysis? In their June 2010 paper entitled “Natural Experiments on Individual Trading: Substitution Effect Between Stock and Lottery”, Xiaohui Gao and Tse-Chun Lin relate individual trading activity to national lottery jackpot size in Taiwan. Using twice-weekly lottery jackpots and contemporaneous Taiwan...
