Household Portfolios in the United States

Bertaut, Carol C.; Starr, Martha A.

doi:10.2139/ssrn.234154

Cited by 204 publications

(171 citation statements)

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“…For example, Heaton and Lucas (2000) used OLS estimation after eliminating those sample individuals whose asset holdings fell below a certain level. On the other hand, Bertaut and Starr-McCluer (2000) used Heckman's selectivity bias correction to account for the fact that many of the portfolio shares are zeros. This study followed Poterba and Samwick (1997) and used a Tobit estimator.…”

Section: Notesmentioning

confidence: 99%

Health and Households’ Portfolio Choices in Europe

Cho

2016

RES

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Using the Survey of Health, Ageing, and Retirement in Europe (SHARE), this study investigated how health is associated with households' portfolio choices in 10 European countries. This study reports three important findings on the relationship between health and portfolio choices. First, households in poor health condition are less likely than households in good health to own various types of financial and non-financial assets. Second, households in poor health condition tend to allocate a lower share of their wealth to risky financial assets, savings for long-term investment, their principal residence, and other non-financial assets while they allocate a larger share to liquid assets such as bank deposits. Third, there exists a regional variation in the magnitude of the correlation between health and portfolio choices. This regional variation can be explained by differences in health care systems. Overall, these findings suggest that negative health shocks are significantly associated with a household's portfolio choices.

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Section: Notesmentioning

confidence: 99%

Health and Households’ Portfolio Choices in Europe

Cho

2016

RES

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“…The stockholding puzzle has been widely documented using data from different countries [e.g., Bertaut and Starr-McCluer (2000) analyses the US, Alessie et al (2000) the Netherlands and Guiso and Jappelli (2000) uses data from Italy] and alternative explanations to it have been proposed such as the combination of high cost of borrowing and uncertain labor earnings (Davis et al 2006) or the heterogeneity in expectations (Vissing-Jorgensen 2003). 3 The role of entry costs has been documented for the US by Vissing-Jorgensen (2000) using data from the Panel Study of Income Dynamics.…”

Section: Ampudia Fraile (B)mentioning

confidence: 99%

Stockholding in Spain

Fraile¹

2013

SERIEs

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This paper explores the stock holdings of Spanish households. As found for other developed countries, the major part of Spanish households does not participate in the stock market. We analyse the impact that entry costs can have in this decision by looking at how wealth, education and a series of other characteristics affect the probability of households owning stock. We also look at a sample of highly 'sophisticated' households from which we should expect full participation in the stock market. Lastly, we analyse how the decision to hold stocks is related to the decision of holding safe assets, housing, businesses, pension plans and consumer debt.

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“…In this case, the household receives the interest payment and does not pay any cancellation fee. 6 Contrary to previous literature, we do not restrict our model to just liquid or illiquid assets, because in each of the three subgroups we consider, the assets present di¤erent characteristics, returns, and volatilities. We thus assume that the market for mortgages and deposits, assuming the household does not pay the deposit cancellation fee, operates with a lag with respect to the liquid assets.…”

Section: Modelmentioning

confidence: 99%

Portfolio choice with indivisible and illiquid housing assets: the case of Spain

Mayordomo¹,

Rodríguez‐Moreno²,

Peña³

2013

Quantitative Finance

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This paper presents a procedure for computing the theoretically optimal portfolio under the assumption that housing is an indivisible, illiquid asset that restricts the portfolio choice decision. The analysis also includes the financial constraints households may face when they apply for external funding. The set of financial assets that constitute the household's portfolios are bank time deposits, stocks, mortgage, and housing. We compare the theoretically optimal portfolio against Spanish households' actual choices using a unique data set, the Spanish Survey of Household Finance. In comparison with the optimal portfolio, households significantly underinvest in stocks and deposits. In the case of mortgages, the optimal and actual portfolios weights are not unequal. At a more disaggregated level, some additional differences emerge that are explained by demographic, educational, and income characteristics. This paper presents a procedure for computing the theoretically optimal portfolio under the assumption that housing is an indivisible, illiquid asset that restricts the portfolio choice decision. The analysis also includes the …nancial constraints households may face when they apply for external funding. The set of …nancial assets that constitute the household's portfolios are bank time deposits, stocks, mortgage, and housing. We compare the theoretically optimal portfolio against Spanish households' actual choices using a unique data set, the Spanish Survey of Household Finance. In comparison with the optimal portfolio, households signi…-cantly underinvest in stocks and deposits. In the case of mortgages, the optimal and actual portfolios weights are not unequal. At a more disaggregated level, some additional di¤erences emerge that are explained by demographic, educational, and income characteristics. Sergio MayordomoJEL classi…cation: C61, D14, G11

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Household Portfolios in the United States

Cited by 204 publications

References 0 publications

Health and Households’ Portfolio Choices in Europe

Health and Households’ Portfolio Choices in Europe

Stockholding in Spain

Portfolio choice with indivisible and illiquid housing assets: the case of Spain

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