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Illusion of Expertise in Portfolio Decisions:An Experimental Approach

Fellner, Gerlinde; Güth, Werner; Maciejovsky, Boris - Max-Planck-Institut für Ökonomik <Jena> / Abteilung … - 2001

This paper focuses on egocentric biases in financial decisions. Subjects first designa portfolio, whereby each combination of assets yields the same expected returnand variance of returns. They are then confronted with two alternative portfolios;the average portfolio and the portfolio of one’s...

Persistent link: https://www.econbiz.de/10005867327

Illusion of control as a source of poor diversification: Anexperimental approach

Fellner, Gerlinde - Max-Planck-Institut für Ökonomik <Jena> / Abteilung … - 2004

illusion of control. By forming their portfolio of tworisky lotteries and one risk-less alternative, subjects are requested to … investment. Also, offering adefault portfolio strongly determines final allocations. …

Persistent link: https://www.econbiz.de/10005866777

Risk Attitude and Market Behavior:Evidence from Experimental Asset Markets

Fellner, Gerlinde; Maciejovsky, Boris - Max-Planck-Institut für Ökonomik <Jena> / Abteilung … - 2002

In this paper we relate individual risk attitude as elicited by binary lotteriesand certainty equivalents to market … equivalents are poorly correlated. Only lottery choices are relatedto market behavior: the higher the degree of risk aversion the … lower theobserved market activity. Females are more risk averse than males accordingto binary lotteries, submit fewer offers …

Persistent link: https://www.econbiz.de/10005867015

Overconfidence in Investment Decisions:An Experimental Approach

Dittrich, Dennis; Güth, Werner; Maciejovsky, Boris - Max-Planck-Institut für Ökonomik <Jena> / Abteilung … - 2001

We experimentally test overconfidence in investment decisions by offering participants the possibility to substitute … their own for alternative investment choices.Overall, 149 subjects participated in two experiments, one with just one risky …

Persistent link: https://www.econbiz.de/10005867326

Motivated beliefs, social preferences, and limited liability in financial decision-making

Ahrens, Steffen; Bosch-Rosa, Ciril - 2022

of liability. Our results reflect the importance of social preferences when making investment decisions for others. We … probability that their investment results in a gain. In other words, we find that social preferences appear to be correlated with …

Persistent link: https://www.econbiz.de/10013446639

Price dynamics and trader overconfidence

Ahrens, Steffen; Bosch-Rosa, Ciril; Roulund, Rasmus - 2019

Overconfidence is one of the most important biases in financial markets and commonly associated with excessive trading and asset market bubbles. So far, most of the finance literature takes overconfidence as a given, "static" personality trait. In this paper we introduce a novel experimental...

Persistent link: https://www.econbiz.de/10012141867

Coordination under loss contracts

Ahrens, Steffen; Bitter, Lea; Bosch-Rosa, Ciril - 2020

In this paper we study the effects that loss contracts - prepayments that can be clawbacked later - have on group coordination when there is strategic uncertainty. We compare the choices made by experimental subjects in a minimum effort game. In control sessions, incentives are formulated as a...

Persistent link: https://www.econbiz.de/10012290029

Risk-taking under limited liability: Quantifying the role of motivated beliefs

Bosch-Rosa, Ciril; Gietl, Daniel; Heinemann, Frank - 2019

This paper investigates whether limited liability affects risk-taking through motivated beliefs. To do so, we run a … within-subject experiment in which subjects invest in a risky asset under full or limited liability. In both cases, before … the investment is made, subjects observe a noisy signal that indicates whether the investment will succeed or fail. They …

Persistent link: https://www.econbiz.de/10012290341

Intertemporal consumption and debt aversion: A replication and extension

Ahrens, Steffen; Bosch-Rosa, Ciril; Meissner, Thomas - 2022

correlating a new individual index of debt aversion on individual characteristics such as gender, cognitive ability, and risk … aversion. The findings suggest that gender and risk aversion are not correlated with debt aversion. However, cognitive ability …

Persistent link: https://www.econbiz.de/10012803569

Intertemporal consumption and debt aversion: A replication and extension

Ahrens, Steffen; Bosch-Rosa, Ciril; Meissner, Thomas - 2022

Persistent link: https://www.econbiz.de/10013197552