Age dependent portfolio selection
AbstractThis paper addresses the issue of portfolio risk exposure as a function of age, and it focuses the debate by presenting detailed cross-sectional evidence about individual portfolios. It provides new empirical results that characterized the relationship between age and the risk exposure of individual portfolios. The evidence from cross-sectional data suggests that individuals do not follow behavior proscribed by economic theory or by Wall Street advisors, rather the results of this paper suggest that current body of theoretical literature does not adequately describe the behavior of individuals. It implies that a satisfactory model ofindividual behavior needs to focus on factors not linearly correlated with age.
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Bibliographic InfoPaper provided by Federal Reserve Bank of St. Louis in its series Working Papers with number 1994-003.
Date of creation: 1994
Date of revision:
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