Journal of Business and Psychology

, Volume 13, Issue 2, pp 281–288 | Cite as

Risk Taking in Personal Investments

  • Walena C. Morse
Article

Abstract

Risk taking in personal investments was investigated. Participants were a heterogeneous group of 59 males and 54 females at least 30 years old and employed. Results show that individual investors can accurately judge risk level of investments for all but the riskiest categories. However, no relationship was found between knowledge of risk and risk level of chosen investments. Participants did not match risk level of their investments to their self-reported risk level. This study also extended the research of Wong and Carducci (1991) beyond undergraduate participants. No relationship was found between level of sensation seeking and risk level of chosen investments.

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REFERENCES

  1. Evans, D. A., Holcomb, J. H., & Chittenden, W. T. (1989). The relationship between risk-return preference and knowledge in experimental financial markets. The Journal of Behavioral Economics, 18, 19–40.Google Scholar
  2. Gitman, L. J., & Joehnk, M. D. (1996). Fundamentals of investing (6th ed.). New York: HarperCollins.Google Scholar
  3. Wong, A., & Carducci, B. J. (1991). Sensation seeking and financial risk taking in everyday money matters. Journal of Business and Psychology, 5, 525–530.Google Scholar
  4. Zuckerman, M. (1979). Sensation seeking: Beyond the optimal level of arousal. Hillsdale, N.J.: Lawrence Erlbaum Associates.Google Scholar

Copyright information

© Human Sciences Press, Inc. 1998

Authors and Affiliations

  • Walena C. Morse
    • 1
  1. 1.Department of PsychologyWest Chester UniversityWest Chester

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