Please use this identifier to cite or link to this item:
Appears in Collections:Accounting and Finance Journal Articles
Peer Review Status: Refereed
Title: The risk perceptions of individual investors
Authors: Veld, Chris
Veld-Merkoulova, Yulia V
Keywords: Individual investors
Risk profile
Downside risk measures
Experimental questionnaire study
Issue Date: Apr-2008
Publisher: Elsevier
Citation: Veld C & Veld-Merkoulova YV (2008) The risk perceptions of individual investors, Journal of Economic Psychology, 29 (2), pp. 226-252.
Abstract: Risk perceptions of individual investors are studied by asking experimental questions to 2,226 members of a consumer panel. Their responses are analyzed in order to find which risk measures they implicitly use. We find that most investors implicitly use more than one risk measure. For those investors who systematically perceive risk according to the same risk measure, semi-variance of returns is most popular. Semi-variance is similar to variance, but only negative deviations fro the mean or another benchmark are taken into account. Stock investors implicitly choose for semi-variance as a risk measure, while bond investors favor probability of loss. Investors state that they consider the original investment to be the most important benchmark, followed by the risk-free rate of return, and the market return. However, their choices in the experimental questionnaire study reveal that the market return is the most important benchmark.
Type: Journal Article
DOI Link:
Rights: Published in Journal of economic psychology by Elsevier
Affiliation: University of Stirling
Accounting and Finance

Files in This Item:
File Description SizeFormat 
the-risk-perceptions-of-individual-investors-revision-may30.pdf246.12 kBAdobe PDFView/Open

This item is protected by original copyright

Items in the Repository are protected by copyright, with all rights reserved, unless otherwise indicated.

If you believe that any material held in STORRE infringes copyright, please contact providing details and we will remove the Work from public display in STORRE and investigate your claim.