The Effect of Demographics and Personality on Investment Choice among UK Investors

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Many studies have been undertaken across the world by scholars as well as academicians in the field of behavioral finance to explore what all psychological and demographic factors affect personal investment decisions and choice among alternatives.


Hershey and Schoemaker in 1980 observes that women investors are more risk averse than men as regards gamble is concerned (Hershey 1980). Another popular study on the gender practices of investing; the researchers remark that both men and women are equally successful in investment decisions and there found no significance difference in investment decisions between male and female groups (Hudgen 1985). In an empirical study among men and women investors in auctions and lotteries undertaken by W. V Harlow and Keith Brown document that men prefer to take more risk than women as regards lottery and auction investments are concerned (Harlow 1990). In another significant study on investment behaviour among individual investors considering their income level William Riley and K Victor Chow attempt to remark that "relative risk aversion decreases as one rises above the poverty level and decreases significantly for the very wealthy. It also decreases with age-but only up to a point. After age 65 (retirement), risk aversion increases with age" (Riley 1992). However, the authors speculate that "education, income and wealth are all highly correlated, so the relationship may be a function of wealth rather than education" (Riley 1992). ...
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