Risk attitude and capital market participation: is there a gender investment gap in Germany?

ZEW Discussion Paper No. 20-080

55 Pages Posted:

See all articles by Jan-Christian Fey

Jan-Christian Fey

affiliation not provided to SSRN

Oliver Lerbs

University of Muenster

Carolin Schmidt

University of Cambridge - Department of Land Economy; ZEW – Leibniz Centre for European Economic Research

Martin Weber

University of Mannheim - Department of Banking and Finance

Date Written: December 10, 2020

Abstract

Do women invest di fferently than men? We contribute to the answer of this question by analysing the Panel on Household Finances (PHF) of the German Bundesbank. This representative panel collects a wide variety of behavioural and fi nancial variables in the area of household fi nance. We find that participation in risky assets is generally lower among women than among men. Once risk attitude is controlled for, this eff ect shrinks to only 2.6 percent. We find no diff erence when single women are compared to single men -- even irrespective of other demographic variables. The raw gap in capital market participation is mainly explained by diff erent risk attitudes and monetary endowments, but women would participate even less in the capital market if they reacted as sensitively to risk aversion as their male counterparts. Lastly, given participation in the market, we fi nd that both genders hold comparable portions of risky assets in their portfolios. Within their risky assets, men invest more in certifi cates and listed shares whereas women invest more in funds.

Keywords: Capital market participation, gender, risk attitude, risky assets

JEL Classification: G11

Suggested Citation

Fey, Jan-Christian and Lerbs, Oliver and Schmidt, Carolin and Weber, Martin, Risk attitude and capital market participation: is there a gender investment gap in Germany? (December 10, 2020). ZEW Discussion Paper No. 20-080, Available at SSRN: https://ssrn.com/abstract=

Jan-Christian Fey

affiliation not provided to SSRN

Oliver Lerbs

University of Muenster ( email )

Schlossplatz 2
Muenster, D-48149
Germany

Carolin Schmidt (Contact Author)

University of Cambridge - Department of Land Economy ( email )

19 Silver Street
Cambridge, CB3 9EP
United Kingdom

ZEW – Leibniz Centre for European Economic Research ( email )

P.O. Box 10 34 43
L 7,1
D-68034 Mannheim, 68034
Germany

HOME PAGE: http://www.carolinschmidt.de

Martin Weber

University of Mannheim - Department of Banking and Finance ( email )

D-68131 Mannheim
Germany
+49 621 181 1532 (Phone)
+49 621 181 1534 (Fax)

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