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1 – 9 of 9This paper sets out to corroborate the existing literature on investors' risk tolerance and to assess how the 2008 financial crisis has affected risk tolerance among Italian…
Abstract
Purpose
This paper sets out to corroborate the existing literature on investors' risk tolerance and to assess how the 2008 financial crisis has affected risk tolerance among Italian investors.
Design/methodology/approach
Based on a unique dataset of real-world portfolio choices made by 1,245 Italian investors over a period of 15 years (from 2003 to 2017), this paper presents two steps of analysis. In step 1, the whole period 2003–2017 is considered with the aim to integrate and corroborate the existing literature on the topic of risk tolerance, considering a complete economic and financial cycle. Step 2 took 2008 as the pivotal point between pre-crisis (2003–2008) and crisis (2009–2017) with the aim to observe the influence on risk appetite of the economic and financial effects of the crisis.
Findings
The results obtained confirm that men are more risk tolerant than women and older people are less risk-taking than their younger counterparts, although the relationship between age and risk tolerance is not necessarily linear. Moreover, our paper demonstrates that a crisis scenario has an influence on Italian investors' risk tolerance.
Practical implications
Our results are of interest to financial advisors, financial planners, asset managers, psychologists, behavioral researchers and more in general to providers of financial products and services.
Originality/value
The results presented in this paper are relevant and original because they are based on real investors who made real choices concerning their portfolio asset allocations.
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Andrea Lippi, Laura Barbieri and Federica Poli
The purpose of this paper is to examine which individual traits of financial advisors influence portfolio transfer speed when a financial advisor recommends investors to migrate…
Abstract
Purpose
The purpose of this paper is to examine which individual traits of financial advisors influence portfolio transfer speed when a financial advisor recommends investors to migrate to a new financial intermediary.
Design/methodology/approach
With reference to the years 2014–2016, one of the three leading Italian tied-agent banks provided the authors with an exclusive and unique data set containing information regarding the financial advisors who had become tied agents, transferring their existing portfolios from their previous banks (traditional or tied-agent banks). The authors observed the ability of the migrant financial advisor in successfully transferring the entire portfolio declared within 12 months of observation. To investigate empirically which personal traits of financial advisors determine their success in the rapid transfer of clients’ portfolios to a new financial intermediary, the authors applied a Cox proportional hazards model.
Findings
The authors find that factors such as age, type of bank of origin and size of the managed financial portfolio positively affect the speed transfer.
Practical implications
The obtained results may be interesting for guiding recruiting policies of financial intermediaries.
Social implications
Regulators should closely examine the phenomenon analyzed in this paper to avoid conflict of interests.
Originality/value
The literature on this topic is scarce, mainly due to the lack of available data. This paper represents an original contribution to open a new field of research.
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Ilaria Galavotti, Andrea Lippi and Daniele Cerrato
This paper aims to develop a conceptual framework on how the representativeness heuristic operates in the decision-making process. Specifically, the authors unbundle…
Abstract
Purpose
This paper aims to develop a conceptual framework on how the representativeness heuristic operates in the decision-making process. Specifically, the authors unbundle representativeness into its building blocks: search rule, stopping rule and decision rule. Furthermore, the focus is placed on how individual-level cognitive and behavioral factors, namely experience, intuition and overconfidence, affect the functioning of this heuristic.
Design/methodology/approach
From a theoretical standpoint, the authors build on dual-process theories and on the adaptive toolbox view from the “fast and frugal heuristics” perspective to develop an integrative conceptual framework that uncovers the mechanisms underlying the representativeness heuristic.
Findings
The authors’ conceptualization suggests that the search rule used in representativeness is based on analogical mapping from previous experience, the stopping rule is the representational stability of the analogs and the decision rule is the choice of the alternative upon which there is a convergence of representations and that exceeds the decision maker's aspiration level. In this framework, intuition may help the decision maker to cross-map potentially competing analogies, while overconfidence affects the search time and costs and alters both the stopping and the decision rule.
Originality/value
The authors develop a conceptual framework on representativeness, as one of the most common, though still poorly investigated, heuristics. The model offers a nuanced perspective that explores the cognitive and behavioral mechanisms that shape the use of representativeness in decision-making. The authors also discuss the theoretical implications of their model and outline future research avenues that may further contribute to enriching their understanding of decision-making processes.
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Maria Gaia Soana, Andrea Lippi and Simone Rossi
This paper investigates the stock market reaction to three different events related to the UEFA Champions League – the announcements of draws, odds and match results. The aim of…
Abstract
Purpose
This paper investigates the stock market reaction to three different events related to the UEFA Champions League – the announcements of draws, odds and match results. The aim of the paper is to test whether these events are informative for stock market operators, i.e. whether they produce abnormal returns.
Design/methodology/approach
Applying the event study methodology, the authors investigate the stock market reaction before (at two events: the draw date and on the release of betting odds) and after the matches of 11 listed soccer teams in the period 2003–2019. The authors also conduct OLS regression analyses in order to disentangle the impact of firm specific variables and match characteristics on cumulative abnormal returns.
Findings
This paper finds that match outcomes affect the stock market performance of listed teams, while the announcements of draws and odds do not. More specifically, the market does not consider match outcomes involving wins and ties as informative events, while it penalizes losing teams. Moreover, investor reactions to events related to the UCL competition depend more on match characteristics than on company specific variables.
Originality/value
The study enriches the ongoing debate about the impact of soccer team results on stock market performance in several ways: using the widest time span ever adopted in this area; focusing on UCL, which is the most important soccer competition played by private clubs; disentangling for the first time the effects of draws, odds release and sporting outcome on stock returns of listed soccer clubs.
Details
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Ana María Barrera-Rodríguez, Paola Andrea Echeverri-Gutiérrez, Isabel Redondo-Ramírez and Leidy Hernández-Ramírez
This article develops a review of the university social responsibility literature to identify the most influential countries, authors, journals, and institutions, their structure…
Abstract
Purpose
This article develops a review of the university social responsibility literature to identify the most influential countries, authors, journals, and institutions, their structure, and research lines.
Design/methodology/approach
The review was carried out from a bibliometric and network analysis of documents published in the Web of Science database.
Findings
In total, 192 documents were found that were scientifically mapped in this field. From the network analysis, four research perspectives were identified: strategic impact management policy, user and its stakeholders, service-learning and its contribution to user, and theories, approaches, and strategies of University Social Responsibility (USR). Finally, the agenda for future research are presented.
Originality/value
The present work carries out a bibliometric and network analysis that seeks to contribute to the literature on USR, identifying its current perspectives and future lines of research.
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Edoardo Lozza, Cinzia Castiglioni, Andrea Bonanomi and Federica Poli
The paper aims to examine whether financial advisors can understand the symbols and meaning that investors associate with money and whether such ability plays any role in…
Abstract
Purpose
The paper aims to examine whether financial advisors can understand the symbols and meaning that investors associate with money and whether such ability plays any role in enhancing the advisor-investor relationship in terms of satisfaction, level of trust, referral propensity and loyalty.
Design/methodology/approach
The authors used a dyadic research design. A total of 186 dyads of financial advisors and their clients took part in the study and completed two parallel self-administered questionnaires.
Findings
The authors found that financial advisors often can detect the emotional associations that their clients attribute to money. Such ability can enhance their relationship with investors.
Research limitations/implications
The main limitation of this study is its exploratory nature and the convenience sampling technique that was adopted. Therefore, researchers are encouraged to test the main findings further.
Practical implications
The results have implications for the development of ad-hoc psychological training to enhance the relationship between financial advisors and investors. Understanding the symbolic meanings and the emotions that clients associate with money may be a prerequisite for a financial services company to succeed and be competitive in the sector.
Originality/value
Despite acknowledging that money is not a neutral object but is layered with symbolic meanings and emotional associations, the behavioral finance literature has so far neglected to study these implications from either a theoretical or a practical point of view. This paper aims to fill this gap by investigating the symbolic value of money in the financial services industry.
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THERE are so many major questions before the library profession that librarians are naturally curious about the manner and matter of the Annual Conference. And critical too; we do…
Abstract
THERE are so many major questions before the library profession that librarians are naturally curious about the manner and matter of the Annual Conference. And critical too; we do not say justifiably; but it is the one general assembly in the year where a consensus of opinion ought to be possible. The business meeting itself is usually quite unsuitable as a gauge of opinion. That the Southport one seemed to demonstrate. We have advocated in these pages that the Library Association Council should base most of the Conference on its own determined policies and not fritter away invaluable hours on long papers which, interesting as they can be made, add very little year by year towards progress in our aims and objects.