Risk- and social preferences of individual investors
This dissertation investigates how risk preferences and social preferences drive investment decisions of individuals. I combine three different datasets, from two different Dutch socially responsible banks and from a Dutch mainstream provider of mutual funds that offers both conventional and socially responsible mutual funds. Furthermore, I make use of different research methods: field experiments, surveys and individual investor transaction data. The main advantage of the investor trading data is that they represent revealed choices of more than 100,000 individual investors from January 1992 to June 2010. The experimental and survey data allow me to get more detailed insights into the beliefs of investors and to elicit their preferences.
Overall, my evidence emphasizes the role of the mutual fund broker and banks in the relationship to their customers and stresses the advantages of helping investors to match their portfolio to their individual preferences. Mutual fund brokers can do this in several ways. This way, mutual fund brokers and banks can keep investors satisfied and, at the same time, generate long-term revenue.