Investing, personality and social preferences : essays on the psycho-graphics of US individual investors
Year: 2017
Type: dissertation
Study design: Observational Study
Abstract: In three essays, I investigate whether investors’ social preferences and personality traits can \nhelp explain individual investors' investment decisions. The first essay investigates whether \ninvestors' social preferences are associated with three measures of engagement in socially \nresponsible investments (SRI): (1) 'interest' in investing, (2) the likelihood of having invested, \nand (3) the share of the portfolio invested. The results suggest that investors' social \npreferences are positively associated with the reported 'interest' investors have in investing in \nSRI, and the likelihood that investors have invested in SRI in the past. I do not find evidence \nthat investors' social preferences are associated with the share of their portfolio invested in \nSRI. This pattern is consistent with a 'warm glow' interpretation of investor motivation to \nhold SRI. The second essay explores whether investors' personality traits - linked to prosocial \nbehaviour - are associated with two measures of engagement in SRI: (1) 'interest' in investing, \nand (2) the likelihood of having invested. The findings suggest that prosocial personality \ntraits are related to both the 'interest' investors' report in investing in SRI, and the likelihood \nthat investors' have invested in SRI in the past. What is more, investors' aversive personality \ntraits are also associated with the likelihood that investors' have invested in SRI in the past. \nTogether, these results suggest that both 'altruistic' and 'selfish' motivations drive investors' \nengagement in SRI. The third essay investigates whether investors' personality traits - linked \nto risk taking - are associated with four measures of financial risk taking. The evidence I \nuncover in the third essay paints an unclear picture, on the whole the evidence suggests that \ninvestors' personality traits are not very important characteristics when it comes to financial \nrisk taking.
Author: Moritz Wiesel
Language: English
Subfield: Finance
Domain: Social Sciences
Open Access status: green
OpenAlex ID: W2892832126