Risk Tolerance Level Research Articles

Perception of Women Towards Investment in Different Investment Alternatives

Women are empowered to take active participation in investment activities through financial education and an inclusive investment environment. Several alternatives to investing are available, including mutual funds, real estate, precious metals, savings accounts, and stocks, which offer potential returns through regular income or capital appreciation. Investment alternatives are differentiated by their unique features, risks, returns, and ease of management. Investors, before investing, must take these features into account in relation to their risk tolerance, goals, and time horizon when considering any particular alternative. As women are recognized for making risk-averse investment decisions, their investments are impacted by numerous factors. The primary goal of this study is to understand the investment perception of women towards different investment alternatives. While the main factors influencing investment decisions are return, risk, and liquidity, several other factors specifically influence women investors, such as social and cultural norms, peers, and family members. Primary data was collected through a well-structured questionnaire consisting of Likert scale questions. SPSS software was used for data analysis. The initial results of the survey showed that 70% of the respondents had an average understanding of different investment options, whereas only 5% had high knowledge of different investment alternatives. When it comes to interest in a particular investment, mutual funds are the most preferred alternative. Additionally, 72% of women respondents show a moderate level of risk tolerance among all respondents in the study.

Determinants of financial planning decisions for salaried individuals: Evidence from India

In the Indian context, financial planning for salaried individuals has gained increased importance due to economic fluctuations, rising living costs, and the need for robust retirement planning. Despite its importance, there is limited research on the specific factors that influence financial decision-making among salaried employees in India. Understanding these determinants is essential for developing effective strategies to enhance financial well-being among employees. This study explores the key factors influencing financial decision-making among employees, including financial goals, emergency savings, retirement planning, budgeting, financial confidence and literacy, financial stress, use of tax-saving instruments, income level, risk tolerance, and debt levels. A sample of 549 employees from diverse sectors in Uttar Pradesh participated in this research, highlighting the critical aspects of personal financial management that impact financial well-being. The study used a questionnaire-based survey to gather data on factors affecting financial decision-making. Descriptive statistics, correlation, and regression analyses were employed to identify significant predictors. The results reveal that financial literacy, access to resources, attitudes toward retirement planning, and cultural norms significantly influence financial decisions. Additionally, income level, job stability, and social support are crucial in shaping employees’ financial planning. The study recommends enhancing employees’ financial decision-making by offering financial education programs, budgeting tools, retirement planning assistance, debt management programs, tax planning workshops, financial counselling services, and employer match programs for retirement savings. These initiatives aim to boost financial literacy and confidence, enabling employees to make informed financial decisions and improve their financial well-being.

A field study of donor behaviour in the Iranian kidney market

Iran has the world’s only government-regulated kidney market. We report the results of the first field study of donor behaviour in this unusual market. Participants have lower risk tolerance and higher patience levels than the Iranian average but display no difference in rationality from population averages and there is evidence of altruism among participants. We provide an examination of decision-making in extreme situations by individuals in this market, typically at the very bottom of the income distribution, and shed light on the sort of people likely to participate if other nations were to operate such markets.

Comparison of Markowitz Model and Single Index Model with ESG Factors Involved

ESG considerations have become increasingly prominent within the realms of investor and corporate decision-making, underscoring the importance of employing robust methodologies for incorporating ESG factors into portfolio construction. This study aims to leverage the Markowitz Model and Single Index Model to construct portfolios utilizing a selection of 10 stocks, evaluating their applicability across various conditions, particularly investors' risk tolerance levels. Utilizing the solver function within Microsoft Excel, graphical representations will be generated under four distinct constraints, facilitating comparisons based on both graphical depictions and accompanying data analysis. The findings reveal that, under specified conditions, the two models exhibit negligible differences, while highlighting the significant role of ESG constraints in portfolio construction. Nonetheless, given the distinct assumptions and conditions underlying each model's calculations, investors retain the flexibility to choose either approach for portfolio analysis. This research underscores the impact of ESG factors on asset allocation outcomes within both models, offering valuable insights into ESG investing practices and the comparative performances of the Markowitz Model and the Single Index Model.

Cardiovascular disease assessment and management in liver transplantation.

The prevalence and mortality related to end-stage liver disease (ESLD) continue to rise globally. Liver transplant (LT) recipients continue to be older and have inherently more comorbidities. Among these, cardiac disease is one of the three main causes of morbidity and mortality after LT. Several reasons exist including the high prevalence of associated risk factors, which can also be attributed to the rise in the proportion of patients undergoing LT for metabolic dysfunction-associated steatohepatitis (MASH). Additionally, as people age, the prevalence of now treatable cardiac conditions, including coronary artery disease (CAD), cardiomyopathies, significant valvular heart disease, pulmonary hypertension, and arrhythmias rises, making the need to treat these conditions critical to optimize outcomes. There is an emerging body of literature regarding CAD screening in patients with ESLD, however, there is a paucity of strong evidence to support the guidance regarding the management of cardiac conditions in the pre-LT and perioperative settings. This has resulted in significant variations in assessment strategies and clinical management of cardiac disease in LT candidates between transplant centres, which impacts LT candidacy based on a transplant centre's risk tolerance and comfort level for caring for patients with concomitant cardiac disease. Performing a comprehensive assessment and understanding the potential approaches to the management of ESLD patients with cardiac conditions may increase the acceptance of patients, who appear too complex, but rather require extra evaluation and may be reasonable candidates for LT. The unique physiology of ESLD can profoundly influence preoperative assessment, perioperative management, and outcomes associated with underlying cardiac pathology, and requires a thoughtful multidisciplinary approach. The strategies proposed in this manuscript attempt to review the latest expert experience and opinions and provide guidance to practicing clinicians who assess and treat patients being considered for LT. These topics also highlight the gaps that exist in the comprehensive care of LT patients and the need for future investigations in this field.

Farmers’ perception and strategies for mitigating and adapting to climate change impacts in the agricultural sector

Abstract The objectives of this study are 1) to determine farmers’ perceptions, adaptation and mitigation towards climate change; 2) to provide recommendations for appropriate adaptation strategies towards climate change. The research methodology employed was qualitative, involving a literature review and focus group discussions (FGD). The study’s findings reveal several key indicators within the farming community. Farmer perceptions encompass their responses to external factors, comprehension, and assessment of climate change. Adaptation indicators comprise perception, level of exposure, risk tolerance, sociodemographic characteristics, and adaptive capacity. Mitigation strategies involve enhancing productivity and efficiency, implementing specialized technology options, and adapting agricultural management practices. Farmer perceptions highlight the recognition of climate change as a relatively recent phenomenon, coupled with its palpable impact on agriculture. Adaptations made by farmers include pesticide use, adjusted planting seasons, exploring alternative livelihoods, and land cultivation. Mitigation efforts entail the management of water resources and the adoption of cutting-edge agricultural technologies. These indicators, combined with the insights from focus group discussions (FGD), can serve as valuable tools for developing instruments to assess climate change within the agricultural sector.

Validation of an Instrument That Measures Factors Affecting Saudi Parents' Tolerance of Risky Play: A Rasch Analysis.

Benefits of children's participation in risky play are broadly recognized. However, most related research originates in Western countries; none focuses on outdoor play in Eastern countries, including Saudi Arabia. Furthermore, although the literature identifies varying perspectives on risky play among parents, there is no objective measure to assess personal, situational, and cultural factors shaping their risk tolerance. To establish the construct validity and internal reliability of data gathered with the newly developed Factors Affecting Tolerance for Risk in Play Scale (FAC-TRiPS). Instrument development. Online survey. Ninety Saudi parents with children ages 7 to 10 yr. The FAC-TRiPS, a 17-item, self-report measure. We used Rasch analysis (Winsteps 4.4.4) to establish evidence for construct validity (item fit, match of item difficulty and parent tolerance, principal-components results) and internal reliability (person reliability index). Item fit analysis revealed that data from 15 of 17 items (88%) conformed to Rasch model expectations. Item difficulty closely matched parents' risk tolerance level. The principal-components analysis of residuals demonstrated that observed variance (49.6%) closely matched expected variance (49.7%). The first contrast's unexplained variance had an eigenvalue slightly greater than 2.5, suggesting possible multidimensionality. The person reliability index was .90. Preliminary analysis suggests that the FAC-TRiPS yields valid, reliable data measuring factors that influence parents' risk tolerance. Further research is needed. Plain-Language Summary: This study contributes to the knowledge of how parents in Eastern countries perceive risky play. The Factors Affecting Tolerance for Risk in Play Scale (FAC-TRiPS) is a newly developed tool that occupational therapy practitioners can use to understand parents' beliefs about and tolerance for their children's participation in risky play. The findings facilitate an understanding of the complex nature of parenting when determining whether to allow children to participate in risky play activities.

A Comparative Study on Investment Behaviour between Government Employees & Business Person

This study investigates the investment habits of government employees and business individuals, aiming to discern variations in investment approaches, risk tolerance levels, and decision-making methodologies within these distinct groups. By conducting empirical research and analysis, it endeavors to uncover how factors such as income stability, financial knowledge, and resource accessibility influence investment choices. Furthermore, the research examines the impact of psychological factors, societal norms, and economic conditions on investment behaviors within each demographic. The outcomes of this investigation contribute to a deeper comprehension of the complexities surrounding investment decision-making and offer valuable insights for policymakers, financial advisors, and individuals seeking to optimize their investment strategies.

Shocked into side-selling? Production shocks and organic coffee farmers’ marketing decisions

Peru is the world’s leading exporter of organic coffee. Peruvian organic coffee is largely marketed through farmers’ cooperatives which have helped small farmers transition to organic production, earn price premiums over conventional coffee, and access extension services and finance. However, rising temperatures, increasingly volatile rainfall patterns, and the proliferation of pests and diseases make organic production riskier, as organic farmers cannot rely on agrochemicals to protect their farms against production shocks. If members of organic coffee cooperatives respond to production shocks by increasing their sales to private buyers (‘side-selling’), then cooperatives’ financial health could be threatened through reduced bargaining power with buyers and a decrease in scale economies. This paper explores the theoretical incentives for members to side-sell in response to production shocks and gives empirical evidence of how production shocks influence side-selling using panel data from members of two Peruvian specialty coffee cooperatives in 2013 and 2015. The study period coincides with a widespread production shock – the Coffee Leaf Rust (CLR) epidemic of 2012/13 – that decimated coffee production in Peru. We find suggestive evidence that the incidence of CLR on farms is correlated with increased side-selling. Particularly, members with high risk tolerance and high levels of non-coffee income increase side-selling when affected by production shocks. This paper contributes to a growing literature on the determinants of side-selling in agricultural cooperatives by examining the role of production shocks, extending existing theoretical frameworks, and analyzing determinants using panel data methods.

COMPARATIVE STUDY OF DEBT AND EQUITY FUNDS IN INDIA

The purpose of this study is to examine the features of debt and equity funds in the Indian financial market, including their suitability, liquidity, tax implications, risk-return profiles, and other relevant factors. Through the purchase of fixed-income assets such as government bonds, corporate bonds, and money market instruments, debt funds look for investments that have low volatility and consistent returns. Equity funds, on the other hand, have a significant amount of their assets invested in equities, which can result in increased volatility but may also result in higher returns over the long term. According to the findings of the study, equity funds have the potential for bigger returns, while debt funds have a lower risk profile. This is the conclusion reached after comparing the two types of funds. Furthermore, the study investigates the tax consequences of both types of funds, which is crucial because taxes play a large influence in the decisions that are made regarding investments. Debt funds are subject to the short-term capital gains tax if they are kept for a period of time that is shorter than three years. The tax rate on long-term capital gains, on the other hand, is twenty percent, and indexation advantages are included. For equities funds that have been held for more than a year, the tax rate is 10% without indexation on profits that exceed ₹1 lakh. However, the tax rate for gains that are held for a shorter period of time is 15%. This study also investigates liquidity, which is another important factor to consider. Due to the greater liquidity of debt funds in comparison to individual fixed-income instruments, investors have more flexibility to withdraw their money from debt funds when they require it. This is because debt funds have better liquidity. It is possible for the underlying stocks of an equity fund to have an effect on the liquidity of the fund. In general, large-cap funds have superior liquidity than small-cap funds or sector-specific funds. In addition, the various investor profiles and the ways in which debt and equity funds are incorporated into their portfolios are discussed. Those who are retired, conservatives who are looking for returns with a reduced level of risk, or investors who have time horizons that range from short to medium are suitable candidates for debt funds. On the other hand, equity funds are more suitable for long-term investors who are willing to take on a greater degree of risk in the expectation of potentially bigger returns. Additionally, they are an excellent choice for individuals who are interested in riding the stock market's growth wave. Although debt and equity funds are complementary additions to any investor's portfolio, they perform distinct functions and have distinct risk-return profiles. Nevertheless, they are both beneficial to the investor. Prior to making decisions on investments, investors should do a comprehensive evaluation of their level of risk tolerance, investment horizon, and financial objectives. They ought to also give some thought to the possibility of diversifying their investments across a variety of asset classes. A comparative analysis like this one will prove to be a very useful resource for individuals who are considering making investments in India's financial markets. Keywords:- Debt funds, Equity funds, Risk-return profiles, Taxation, Liquidity, Investment suitability, Indian financial market.

Penentuan Portofolio Saham Optimal Menggunakan Metode Markowitz Sebagai Dasar Keputusan Investasi

A stock portfolio is a combination of two or more securities invested over a specific period and under certain conditions. This study analyzes the combination of stocks that can be formed into an optimal portfolio using the Markowitz method. The Markowitz method is employed to maximize returns and minimize the risks associated with a portfolio. This method uses a mathematical formulation that allows for adjustments based on risk tolerance levels and expected returns to achieve an optimal portfolio. The data used in this study comprises the monthly closing prices of stocks from five selected companies, namely ICBP, BBCA, TLKM, BBNI, and INCO, for the period from June 2019 to December 2022. The findings indicate a recommended portfolio with the lowest risk, known as the Minimum Variance Portfolio (MVP). The MVP comprises the following proportions: ICBP 36.10%, BBCA 36.28%, TLKM 17.84%, INCO 8.39%, and BBNI 1.39%. This combination of stock proportions yields an expected return of 8.58% and a portfolio risk of 21.52%.Keywords: Markowitz method, Minimum Variance Portfolio, Portfolio Optimization.

From Theory to Practice: Applying the Markowitz Model in Stock Portfolio Management under ESG

The study consisted of a month-long simulated stock market operation focusing on the comprehensive analysis of equity portfolio creation and management. Against the backdrop of growing concern for environmental protection, the S&P 500 Net Zero 2050 Climate Transition ESG Index was deemed the appropriate benchmark for the portfolios due to the average level of risk tolerance of customers. The investigation began with an in-depth assessment of macroeconomic and sector conditions, followed by careful selection of securities using both fundamental and technical analysis techniques. The portfolio was then optimized using the Markowitz model and subsequently managed using a variety of strategies, including trading, monitoring, and rebalancing. The subsequent phase of the research involves a rigorous evaluation of performance utilizing various metrics including single-period returns and the Sharpe ratio. The study culminates in a reflective analysis of the overall investment project. Despite the portfolio's underperformance against the benchmark, the project provides invaluable insights into the intricacies of stock market investment and portfolio management, accentuating the impact of market volatility and the significance of strategic asset allocation.

The Study on Investment Behavior of Working Women in Chennai

The research project titled "A Study on Investment Behaviour of Working Women in Chennai" investigates the financial habits and preferences of working women in Chennai in the education sector, with a focus on their investment patterns. Primary data required for the descriptive research was collected through physical questionnaires. The study aims to analyze the impact of factors such as age, income levels, education, and employment sectors on investment behavior, as well as the influence of digitalization skills, financial knowledge, and risk tolerance levels. With a purposeful sample size of 350 working women and a purposive sampling technique. The percentage analysis, Weighted Average, Regression analysis, and ANOVA were performed for the research using SPSS (v16) software. The research provides valuable insights into the investment behavior of this demographic. The findings highlight the prevalence of short-term investment preferences, the need for enhanced financial literacy programs, and the influence of external factors on investment patterns.

Gender Differences in Risk Preferences and Insurance Choices

Purpose: The general purpose of the study was to examine gender differences in risk preferences and insurance choices.
 Methodology: The study adopted a desktop research methodology. Desk research refers to secondary data or that which can be collected without fieldwork. Desk research is basically involved in collecting data from existing resources hence it is often considered a low cost technique as compared to field research, as the main cost is involved in executive’s time, telephone charges and directories. Thus, the study relied on already published studies, reports and statistics. This secondary data was easily accessed through the online journals and library.
 Findings: The findings reveal that there exists a contextual and methodological gap relating to gender differences in risk preferences and insurance choices. The study provided valuable insights into the complex dynamics shaping individuals' attitudes towards risk and insurance decisions. Through comprehensive analysis, it confirmed significant gender disparities in risk preferences, with men generally exhibiting higher levels of risk tolerance compared to women. Additionally, it revealed that women demonstrated a greater propensity to purchase insurance coverage, contrary to traditional stereotypes. The study emphasized the importance of considering intersectionality in understanding gender disparities in insurance access and highlighted the role of behavioral economics in influencing decision-making processes. Overall, the findings underscored the need for targeted interventions and policy initiatives to address gender-based disparities in insurance access and promote financial well-being across diverse populations.
 Unique Contribution to Theory, Practice and Policy: Social Role theory, Behavioural Economics and Feminist theory may be used to anchor future studies on risk preferences and insurance choices. The study made several recommendations to address gender disparities in risk management and insurance access. It suggested the development of targeted financial education programs, gender-sensitive insurance products, and regulatory measures to promote gender equality in insurance coverage. Additionally, the study emphasized the importance of fostering diversity and inclusion within the insurance industry and continuing research to monitor progress over time. By implementing these recommendations, stakeholders aimed to create more inclusive and equitable insurance markets, enhancing financial security and well-being for all individuals.
 Keywords: Gender Differences, Risk Preferences, Insurance Choices, Financial Education, Gender-Sensitive, Regulatory Measures, Diversity, Inclusion, Equity

Risk and Return Analysis on Selected 10 Companies: a Five-year Study (2018-2022)

The "Risk and Return Analysis on Selected 10 Companies: A Five-Year Study (2018-2022)" delves into the intricate dynamics of risk and return within the equity market landscape over a significant period. Through meticulous examination spanning five years, this study aims to unravel the performance metrics of ten carefully chosen companies, providing investors and financial analysts with invaluable insights into optimizing portfolio strategies and maximizing returns. Employing contemporary methodologies and empirical data, the study contributes to the ongoing discourse surrounding risk-return dynamics, addressing the escalating need for evidence-based decision-making in financial markets amidst increasing complexity and volatility. Methodologically, the study employs a multifaceted approach, including the meticulous selection of ten companies based on predefined criteria, comprehensive data collection, and the application of various quantitative techniques to evaluate risk and return metrics. The analysis focuses on equity stocks over the specified five-year period, utilizing variance and standard deviation as fundamental statistical measures to quantify dispersion and volatility of stock returns. The study aims to furnish stakeholders with actionable insights to optimize investment decisions and mitigate potential risks effectively, ultimately aiding stakeholders in making well-informed investment decisions aligned with their financial objectives and risk tolerance levels.

Portfolio optimisation of international real estate investment trusts market during COVID-19: A behavioural perspective

This paper employs the cumulative prospect theory to investigate how deviation from rational investor asset selection improves portfolio optimisation. Firstly, asset portfolios are constructed by utilising the cumulative prospect theory, which captures investors’ psychology and risk tolerance and is herein referred to as a behavioural portfolio (BF). Secondly, the cluster technique is also used to build behavioural-centred investment portfolios that capture all the relevant moment properties of the asset return distribution as well as investors’ psychological dynamics and risk appetite, herein called the cluster moment behavioural portfolio (CMBF). The constructed portfolios are optimised by copula and differential evolution techniques. The analysis of optimisation of the constructed portfolios indicates that for behavioural portfolios (BF), in all phases of our sample period, portfolios with higher behavioural scores outperformed those with lower behavioural scores. And in the cluster moment behavioural portfolio (CMBP), for the pre-COVID and the COVID phases, the portfolios with lower behavioural scores outperform those with higher behavioural scores; however, for the full sample phase, the portfolio with a higher behavioural score outperforms the portfolio with the lower behavioural scores. The optimisation results of all the constructed portfolios largely favour portfolios with higher behavioural scores over those with lower scores. The results offer investment suggestions to guide investors with varying risk tolerance levels and those who deviate from the rational investor on how they can enhance their portfolio optimisation.

Analysing the Life Satisfaction of Risk-averse and Risk-loving Investors in South Africa

Financial well-being is normally referred to as a person’s contentment with their financial situation. The level of life satisfaction among investors may vary depending on factors such as their risk tolerance and demographics. Demographic variables such as age and gender may influence an investor’s life satisfaction, which, in turn, could influence their financial decisions. Furthermore, an investor’s willingness to take risks can also affect financial decisions, ultimately influencing their life satisfaction. The objective of this paper is to identify and determine the influence of demographics and risk tolerance levels on individual investor life satisfaction. Secondary data were obtained in the private domain from an investment company that collected 1 059 from its client base. The results of this research paper indicated that there is a significant difference between the satisfaction of life of risk-averse and risk-loving investors. Risk-averse investors showed a negative relationship with life satisfaction, while risk-loving investors showed a positive relationship. This meant that the more risk-averse investors were, the lower the life satisfaction, indicating that high life satisfaction was accompanied by high risk. A significant difference was also found between life satisfaction and age and gender. Male investors were more satisfied with their lives than female investors. Older investors experienced higher levels of life satisfaction compared to investors in other age groups. As a result, these findings will make a considerable contribution to the way financial managers create investment portfolios for their clients.

The Influence of Gender on Individuals’ Ability to Predict Their Own Risk Tolerance: Evidence from a European Country

The literature on individuals’ ability to predict their own level of risk tolerance is scarce and presents divergent results. Utilizing both differential prediction models and logit models on a sample of 391 individuals in Portugal, this study demonstrates that respondents’ gender play a crucial role in this predictive ability. Men tend to overestimate their level of risk tolerance, while women tend to believe they are less risk-tolerant than they actually are. Furthermore, the results reveal that men’s ability to correctly predict their level of risk tolerance is significantly higher. Being a man implies a 20% higher probability of being consistent in this prediction compared to being a woman, even after controlling for a set of sociodemographic factors. The finding of a systematic inconsistency between measures of subjective and objective risk tolerance suggests that the choice between the two measures of risk propensity is not indifferent. Our findings have relevant implications in the fields of corporate finance, financial investment, and various other spheres of economic life.

Herding Bias and Financial Risk Tolerance On Individual Investment Performance in Nigeria: Moderated by Financial Literacy

Prior studies have shown that various individuals’ behavioral traits such as herding bias and risk tolerance have an unfavorable effect on investors' decision-making. This paper examined the moderating role of financial literacy on herding bias and financial risk tolerance on individual investment performance in Nigeria. The population consisted of 460 active individual investors in Kaduna city as at the first quarter of 2023. A total of 460 copies of questionnaires were distributed, with 349 valid. A census method of sampling was used, and primary data was collected using a self-administered questionnaire and an online Google form. A 7-point Likert scale that ranged from '1' "Extremely Agree" to '7' "Extremely Disagree" was used. Smart-PLS version 4 was used to analyze the data. The study discovered that the herding bias has a positive and significant effect on investment performance, whereas financial risk tolerance has an insignificant negative effect on investment performance. Financial literacy has a positive but insignificant impact on investment performance. Furthermore, the moderating effect of financial literacy demonstrated that the herding bias has a significant and positive impact on investment performance. Risk tolerance has a significant negative influence on investment performance. This study concluded that herding bias helps investors make better investment decisions, Consequently, the study recommends that investors should reduce their risk tolerance levels while maintaining the herding behavioral bias.

Quantile Hedging in the complete financial market under the mixed fractional Brownian motion model and the liquidity constraint

This article proposes a pricing framework for European option that utilizes a Quantile hedging strategy in a complete financial market. The methodology involves applying the long memory Geometric Brownian motion model, utilizing the generalized mixed fractional Girsanov theorem, and incorporating relevant findings related to quasi-conditional expectation. The first step in this framework is to derive the option price formula using the equivalent martingale measure. This approach enables investors to use the entire option price without any restrictions to hedge their contingent claim. Then, we add the initial wealth condition to hedge and determine the option price with the Quantile hedging strategy. To do this, we find the maximum probability of success in complete risk hedging for different amounts of model parameters and then use the probability values to determine the option price. Moreover, we apply the minimum variance algorithms and the error correction method to find the hedge ratio. Finally, we illustrate the hedging strategy and provide numerical results that assist investors in determining the required capital for covering the option risk under market data. This calculation takes into account both the level of risk tolerance and the anticipated return on investment.