Financial risk tolerance revisited

the development of a risk assessment instrument

Authors

  • John Grable Kansas State University, 318 Justin Hall, Manhattan, KS 66506, USA
  • Ruth H. Lytton Virginia Tech, 101 Wallace Hall, Blacksburg, VA 24061, USA

DOI:

https://doi.org/10.1016/S1057-0810(99)00041-4

Keywords:

Heuristics, Risk Assessment, Risk Tolerance

Abstract

This paper explores conceptual, methodological, and empirical issues related to the development of a financial risk-tolerance assessment instrument. Financial risk tolerance is a significant factor in a number of household financial decisions, yet few recognized, valid, and reliable methods of assessment are available for use by financial service providers and educators. Empirical results from a multistage development of a 13-item risk assessment instrument are discussed. The multidimensional instrument is presented as the foundation for the development of a more widely used and accepted index. Future use by practitioners and researchers is encouraged to further validate the usefulness of the instrument. © 2000 Elsevier Science Inc. All rights reserved.

Downloads

Published

1999-09-30

How to Cite

Grable, J., & Lytton, R. H. (1999). Financial risk tolerance revisited: the development of a risk assessment instrument. Financial Services Review, 8(3), 163–181. https://doi.org/10.1016/S1057-0810(99)00041-4

Issue

Vol. 8 No. 3 (1999): Financial Services Review

Section

New Original Submission

License

Copyright (c) 1999 JAI Press Inc.

Creative Commons License

This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License.

Author(s) retain copyright and grant the Journal right of first publication with the work simultaneously licensed under a Creative Commons Attribution-NonCommercial 4.0 International License that allows to share the work with an acknowledgment of the work's authorship and initial publication in this Journal.

This license allows the author to remix, tweak, and build upon the original work non-commercially. The new work(s) must be non-commercial and acknowledge the original work.