An empirical investigation of personal financial risk tolerance
DOI:
https://doi.org/10.61190/fsr.v13i1.4782Keywords:
Risk assessment, Risk toleranceAbstract
We analyze a large database of psychometrically derived financial risk tolerance scores (RTS) and associated demographic information. We find that people's self-assessed risk tolerance generally accords with RTS. Furthermore, we find that gender, age, number of dependents, marital status, income, and wealth arc significantly related to the RTS. Notably, the relationship between age and risk tolerance exhibits a significant nonlinear structure.
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