Empirical evidence on risk aversion for individual romanian capital market investors
The evolution of stock prices is influenced by the expectations of investors regarding the earning prospects associated to each listed company. One of the key elements of investment decision is the positive relationship between risk and return. Risky securities are preferred to less risky ones only if there is a higher pay-off in the long run that could compensate the investors. The previous studies proved that expected return direct correlated with risk and, due to the presence of risk aversion, this relationship is assumed to be positive one. Risk premium is determined by a lot of factors including risk aversion. The intensity of risk aversion and the evolution of it during a specific period of time are very important for any market. This study proposed an analysis of risk aversion that is based on a specific survey and it is very useful for comparative analysis with other similar studies developed on the case of other emerging markets (from EU or outside EU).
Volume (Year): 1 (2008)
Issue (Month): (December)
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Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Arie Kapteyn & Federica Teppa, 2002.
"Subjective Measures of Risk Aversion and Portfolio Choice,"
02-03, RAND Corporation.
- Kapteyn, A. & Teppa, F., 2002. "Subjective Measures of Risk Aversion and Portfolio Choice," Discussion Paper 2002-11, Tilburg University, Center for Economic Research.
- Robert B. Barsky & F. Thomas Juster & Miles S. Kimball & Matthew D. Shapiro, 1997. "Preference Parameters and Behavioral Heterogeneity: An Experimental Approach in the Health and Retirement Study," The Quarterly Journal of Economics, Oxford University Press, vol. 112(2), pages 537-579.
- Clifford B. Hawley & Edwin T. Fujii, 1994. "An Empirical Analysis of Preferences for Financial Risk: Further Evidence on the Friedman-Savage Model," Journal of Post Keynesian Economics, M.E. Sharpe, Inc., vol. 16(2), pages 197-204, January.
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