A Behavioral Model for Asset Allocation

Financial Markets and Portfolio Management, Vol. 17, No. 1, pp. 15-42, 2003

Posted: 12 Sep 2005

See all articles by Martin Weber

Martin Weber

University of Mannheim - Department of Banking and Finance

Abstract

This paper describes a study, in which we examine the diversification behavior of financial advisors. Learning from BENARTZI and THALER (2000) about investors' naive diversification strategies, we find evidence that the advisor's asset allocation can be described by a new behavioral portfolio model. To verify these findings we distributed questionnaires among several investment consultants who gave us information about their market expectations and three asset allocation recommendations. Their recommendations indeed seem to be described by the behavioral portfolio model. Finally, we examine losses of efficiency for their recommendations.

JEL Classification: G0, G1

Suggested Citation

Weber, Martin, A Behavioral Model for Asset Allocation. Financial Markets and Portfolio Management, Vol. 17, No. 1, pp. 15-42, 2003, Available at SSRN: https://ssrn.com/abstract=798245

Martin Weber (Contact Author)

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

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

Here is the Coronavirus
related research on SSRN

Paper statistics

Abstract Views
1,035
PlumX Metrics