Financial Advice and Household Financial Portfolios

45 Pages Posted: 24 Apr 2021

See all articles by Sarah Brown

Sarah Brown

University of Sheffield - Department of Economics; IZA Institute of Labor Economics

Alessandro Bucciol

University of Verona - Department of Economics; Netspar

Alberto Montagnoli

University of Sheffield

Karl Taylor

University of Sheffield - Department of Economics

Abstract

We investigate the role of financial advice in shaping the composition of household portfolios in Great Britain. Advice is associated with a reallocation of wealth away from real estate and towards bonds and stocks, especially when households seek financial advice "for investments". Having a consultation with a stockbroker has a particularly large effect on the portfolio share in stocks. However, even free financial advice has a positive effect on the shares in bonds and stocks, compared to not receiving advice. Finally, we find a positive association between alternative measures of portfolio risk and the composition of the portfolio, whilst accounting for financial advice.

JEL Classification: D81, G11, D14

Suggested Citation

Brown, Sarah and Bucciol, Alessandro and Montagnoli, Alberto and Taylor, Karl B., Financial Advice and Household Financial Portfolios. Available at SSRN: https://ssrn.com/abstract=3833233 or http://dx.doi.org/10.2139/ssrn.3833233

Sarah Brown (Contact Author)

University of Sheffield - Department of Economics

9 Mappin Street
Sheffield, S1 4DT
United Kingdom

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

Alessandro Bucciol

University of Verona - Department of Economics ( email )

Via Cantarane 24
Verona, 37129
Italy
+39 045.802.8278 (Phone)
+39 045.802.8529 (Fax)

HOME PAGE: http://www.sites.google.com/site/abucciol/

Netspar ( email )

P.O. Box 90153
Tilburg, 5000 LE
Netherlands

Alberto Montagnoli

University of Sheffield

17 Mappin Street
Sheffield, S1 4DT
United Kingdom

Karl B. Taylor

University of Sheffield - Department of Economics ( email )

9 Mappin Street
Sheffield, S1 4DT
United Kingdom

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