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Welcome to the 2018 AFS Annual Meeting, being held this year, in conjunction with FPA in Chicago!
Wednesday, October 3 • 4:45pm - 5:45pm
J2b - The Effect of Myopic Behavior on Stock Market Risk Perception

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We investigate whether myopic behavior influences respondents’ risk perception of future stock market returns. Using the 2012 wave of the Health and Retirement Study, we find that investors who are myopic (i.e. follow the stock market “very closely” or “somewhat closely”) are significantly more likely to be in a higher subjective probability group that believes the market for blue chip stocks will drop by 20 percent or more next year. In addition, we find that older cohorts and stockholders have a more accurate perception of future stock market returns than do younger cohorts and non-stockholders. Financial planning implications are provided.

Author(s): Yi Liu , Michael Guillemette

Presenters
avatar for Yi (Bessie) Liu

Yi (Bessie) Liu

Ph.D. Candidate, Texas Tech University
Yi (Bessie) Liu is a Ph.D. student in the Department of Personal Financial Planning at Texas Tech University. She aims to serve diversified groups especially for first and second generation immigrants as well as Asian-Americans to assist them in achieving a better financial futur... Read More →


Wednesday October 3, 2018 4:45pm - 5:45pm
Michigan 1B