Gender Differences in Optimism and Asset Allocation

54 Pages Posted: 16 Nov 2007

See all articles by Ben Jacobsen

Ben Jacobsen

Tilburg University - TIAS School for Business and Society; Massey University

John B. Lee

University of Auckland

Wessel Marquering

Erasmus University Rotterdam (EUR) - Department of Financial Management

Cherry Yi Zhang

Nottingham University Business School China; Massey University - School of Economics and Finance

Date Written: February 1, 2008

Abstract

We investigate two alternative explanations why men may hold more stocks than women. Apart from a gender difference in risk aversion, gender differences in either optimism or in perceived risk of financial markets might cause men to hold more risky assets. Our results show that men tend to be significantly more optimistic than women regarding a broad range of issues, including the economy and the stock market. After taking differences in optimism into account systematic gender differences in asset allocations disappear. Our evidence also suggests that women indeed perceive stock market risk to be significantly higher than men offering a second alternative explanation why women invest less in stocks.

Keywords: Optimism, Pessimism, Gender Difference, Consumer Confidence, Economic Indicators, Risk Aversion

JEL Classification: D1, D8, D9, G11, Z1

Suggested Citation

Jacobsen, Ben and Lee, John B. and Marquering, Wessel A. and Zhang, Cherry Yi, Gender Differences in Optimism and Asset Allocation (February 1, 2008). Available at SSRN: https://ssrn.com/abstract=2583693 or http://dx.doi.org/10.2139/ssrn.1030478

Ben Jacobsen (Contact Author)

Tilburg University - TIAS School for Business and Society ( email )

Warandelaan 2
TIAS Building
Tilburg, Noord Brabant 5037 AB
Netherlands

Massey University ( email )

Auckland
New Zealand

John B. Lee

University of Auckland ( email )

Private Bag 92019
Auckland, 1001
New Zealand
649 373 7599 ext. 85171 (Phone)
649 373 7406 (Fax)

Wessel A. Marquering

Erasmus University Rotterdam (EUR) - Department of Financial Management ( email )

P.O. Box 1738
F4-26
Rotterdam 3000 DR
Netherlands
+31 10 408 2786 (Phone)
+31 10 408 9017 (Fax)

Cherry Yi Zhang

Nottingham University Business School China ( email )

199 Taikang East Rd.
Ningbo, 315100
China

Massey University - School of Economics and Finance ( email )

New Zealand

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