Abstract
We exploit the US Survey of Consumer Finances from 1998 to 2010 to study households’ portfolio risk. We compare alternative measures of ex-ante risk, based on a financial portfolio including deposits, bonds and stocks, or a broader portfolio also including real estate, business wealth and related debt. The measures provide different rankings of portfolio risk, but they all positively correlate with household wealth. Moreover, risk falls at the beginning of the sample period and rises at the end, together with the business cycle. Our findings are robust to different identification assumptions meant to disentangle the age, period and cohort effects.
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