Investment Preferences and Risk Perception: Financial Agents versus Clients

Luisa Kling, Christian König-Kersting and Stefan Trautmann

No 674, Working Papers from University of Heidelberg, Department of Economics

Abstract: We study three fundamental components of financial agency settings: Perception and communication of investment profiles, the interaction of agents’ and clients’ preferences, and the role of (non-)monetary incentives. The perception of investment profile terminology is very heterogeneous, resulting in substantial miscommunication between clients and agents. Financial agents show a high willingness to implement their clients’ preferred investment profiles independent of monetary incentives. Agents’ investments for their clients are biased by their own investment preferences.

Keywords: decisions under risk; decisions of agents; risk perception; financial advice (search for similar items in EconPapers)
Date: 2019-11-20
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