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Millionaire investors: financial advisors, attribution theory and gender differences

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Abstract

To date little attention has been paid to how social cognitive bias can influence how financial advisors interpret and respond to the needs of millionaire investors, and if this varies depending on the gender of the investor. This research investigates whether experienced professional financial advisors who work with millionaire investors make different attributions for the control and knowledge that investors have of their investments, and if they make different investment portfolio recommendations to equivalent male and female investors. Using methodology novel to finance, this vignette-based study that controls for gender finds evidence that professional financial advisors judge millionaire female investors to have less control over their investment portfolios relative to men. Empirical results also show that female advisors judge women to be less knowledgeable about investments than men. Despite such perceptual differences, advisors recommend equally risky portfolios to male and female investors.These results have implications for wealth management institutions and the monitoring of financial advisors for millionaire individuals.

    Research areas

  • Portfolio choice, investment decisions, financial advice, risk-taking, gender, DECISION-MAKING, THINK MANAGER, RISK-TAKING, STEREOTYPES, CONFIDENCE, ALLOCATION, SELECTION, BEHAVIOR, FEMALE, AGENCY
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Details

Original languageEnglish
Pages (from-to)1333-1349
Number of pages17
JournalEuropean journal of finance
Volume24
Issue number15
DOIs
Publication statusPublished - 1 Jan 2018