Abstract
This article presents a multitrial experiment that extends the classic experiment of Thaler et al. [1997] by adding a high-risk stock fund to the bond and stock funds used in the original experiment. Results from the study show that investors allocate the same proportion of their investment to the high-risk stock fund and the stock fund, increasing their investment in the stocks and their expected return. We conducted a similar experiment with all three assets and found no myopic loss aversion. We suggest that high-risk stock funds might reduce the effect of myopic loss aversion.
| Original language | American English |
|---|---|
| Pages (from-to) | 53-64 |
| Number of pages | 12 |
| Journal | Journal of Behavioral Finance |
| Volume | 14 |
| Issue number | 1 |
| DOIs | |
| State | Published - 31 May 2013 |
Keywords
- Multi-periods
- Myopic loss aversion
- Regret
All Science Journal Classification (ASJC) codes
- Experimental and Cognitive Psychology
- Finance
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