Occupation-level income shocks and asset returns: their covariance and implications for portfolio choice

Steven Davis and Paul Willen

No 13-9, Working Papers from Federal Reserve Bank of Boston

Abstract: This paper develops and applies a simple graphical approach to portfolio selection that accounts for covariance between asset returns and an investor's labor income. Our graphical approach easily handles income shocks that are partly hedgeable, multiple risky assets, multiple risky assets, many periods, and life cycle considerations.

Keywords: life cycle portfolio choice; risky labor income; graphical approach; occupation-level income shocks (search for similar items in EconPapers)
JEL-codes: D52 D91 G11 J30 (search for similar items in EconPapers)
Pages: 58 pages
Date: 2013-10-24
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Citations: View citations in EconPapers (5)

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Related works:
Journal Article: Occupation-Level Income Shocks and Asset Returns: Their Covariance and Implications for Portfolio Choice (2013)
Working Paper: Occupation-Level Income Shocks and Asset Returns: Their Covariance and Implications for Portfolio Choice (2000)
Working Paper: Occupation-Level Income Shocks and Asset Returns: Their Covariance and Implications for Portfolio Choice (2000)
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