27 Pages Posted: 19 Feb 2009
Date Written: February 12, 2009
This paper empirically models a number of emotional assets in the optimal investment decision. Using the spanning techniques we analyze how these emotional assets add to the risk-return profile of investors. We find highly significant results for art, wine and books as a significant allocation into the emotional asset sector. Our findings firstly substantiate the current allocation of HNWI in the luxury goods sector, and secondly give rise to substantive evidence for investors choosing to maximize risk and return whilst also being prepared to give up some financial return in some sectors for emotive reasons. This gives insightful evidence that investors tend to integrate both personal and societal values into the portfolio management process and moreover helps us to separate the emotional and investment value when investing into assets in general.
Keywords: Portfolio Management, Asset pricing, Consumption and Investment decisions
JEL Classification: G11, Z11, E21
Suggested Citation: Suggested Citation
Pownall, Rachel A.J. and Koedijk, Kees C. G. and de Roon, Frans, Emotional Assets and Investment Behavior (February 12, 2009). Available at SSRN: https://ssrn.com/abstract=1341875 or http://dx.doi.org/10.2139/ssrn.1341875
By Péter Erdos