Risk investment decisions within the deterministic equivalent income model

Song, Yan; Li, Xin Yun; Li, Yang; Hong, Xianpei

doi:10.1108/k-04-2019-0275

Cited by 6 publications

(5 citation statements)

References 43 publications

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“…Economists use comprehensive risk assessment tools to avoid asking direct questions; they combine objective and subjective elements to form questionnaires (MacCrimmon & Wehrung 1985). Therefore, subjective and objective factors should be assessed holistically (Song et al 2021), as favoured in traditional economic theory (Botha et al 2020;Cooper, Kingyens & Paradi 2014). Risk assessment is a multidimensional concept encompassing the assessment of propensity, attitude, capacity, knowledge, and time horizon (Cooper et al 2014).…”

Section: Nature Of Risk Assessment Toolsmentioning

confidence: 99%

Suitability of risk assessment tools used during the portfolio recommendation process

Baloyi,

Lotter

2024

J. econ. financ. sci.

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Orientation: Investors are overwhelmed with Collective Investment Schemes (CIS) portfolio options.Research purpose: The study set out to assess the emerging themes considered essential and prevalent in establishing a risk profile, establishing a framework for risk assessment tools, and evaluating existing risk assessment tools used in the industry.Motivation for the study: In 2020, newly amended legislation confirmed the importance of a risk assessment. This legislation made it mandatory and compulsory for financial planners to conduct a risk profile analysis concerning investment products in South Africa. Consequently, CIS have implemented various risk assessment tools to establish the investor risk profile.Research approach/design and method: Documentary research methodology was employed, where secondary data were analysed qualitatively. Twelve risk assessment tools were collected, and the established framework was used to evaluate existing risk assessment tools.Main findings: A sound theoretical framework for risk assessment tools, which is comprehensive in nature and include demographic factors, risk categorisation, and regulatory factors, was established. The results indicate that current tools used in the industry are inconsistent and do not address all the factors required to establish an investor risk profile.Practical/managerial implications: The study is significant in that it guides the financial services industry into the elements of assessment in establishing an investor risk profile.Contribution/value-add: A risk profile analysis is compulsory for financial planning. Financial planners and policymakers can consider the established framework to implement a standardised, comprehensive, holistic, risk assessment tool.

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Section: Nature Of Risk Assessment Toolsmentioning

confidence: 99%

Suitability of risk assessment tools used during the portfolio recommendation process

Baloyi,

Lotter

2024

J. econ. financ. sci.

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“…Hasil penelitian sebelumnya mengungkapkan hasil pengaruh norma subyektif terhadap niat investasi berpengaruh positif terhadap pengambilan keputusan investasi (Septyanto, 2013;Raut, 2020;Song et al, 2021). Berdasarkan uraian di atas maka dibangun hipotesis sebagai berikut: H1: norma subyektif berpengaruh positif terhadap pengambilan keputusan investasi.…”

Section: Norma Subyektifunclassified

Determinan Pengambilan Keputusan Investasi Berdasarkan Norma Subjektif, Kontrol Perilaku, Dan Perilaku Heuristik

Wirawan

Mildawati

Suryono

2022

EKUITAS

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This study aims to obtain empirical evidence of the influence of Subjective Norms, Behavioral Control, and Heuristic Behavior on Investment Decisions. We used 54 respondents of individual investors who are just learning and or have already transacted on the Indonesia Stock Exchange (BEI) as a sample. By using multiple regression analysis, we found that the subjective norm has an effect on investment decisions. This means that the higher the influence of individual external environmental pressures, namely observers, friends, mass media, and investment management, the greater the individual's ability to make investment decisions. Behavioral Control has an effect on Investment Decisions. This means an understanding of the simplicity or complexity of taking action based on past experience and the obstacles that may be faced when taking action, affecting individuals in making investments. Heuristic behavior affects investment decision making. This means that the level of confidence and experience possessed by individuals and other known people will influence individuals in making accurate investments.

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“…EN is risk aversion and seeks the maximization of certainty equivalence. Referring to the calculation method of Song et al (2021), the determinant equivalence CEN of EN is as follows:…”

Section: Model Assumption and Model Constructionmentioning

confidence: 99%

Venture investment under multi-stage incentive model based on fairness concerns

Shu

Ding

et al. 2021

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PurposeThis study explores the impact of EN's (venture entrepreneurs, simplified as EN) jealousy fairness concerns coefficient on two-stage venture capital decision-making in cases of symmetrical and asymmetrical information. It discusses the equilibrium solution of two-stage venture.Design/methodology/approachThe principal-agent model was established based on multiple periods, and differentiated contracts were established at different stages. The validity of the models and the contract was verified by numerical simulation.FindingsThe results suggest that with the increase in the EN fairness concerns coefficient, the effort level of EN decreases continuously and decreases faster in the second stage because this is the last stage. The level of VC's (venture capitalist, simplified as VC) effort declines first and then increases; that is, VC will increase the effort level when the fairness concerns coefficient increases to a certain threshold. To motivate EN to pay more effort, VC will increase the incentive to EN in the first stage. However, it will reduce the level of incentive to EN in the second stage. In the limited stage of venture investment, consider that the fairness concerns of EN do not make the profits of EN and VC achieve Pareto improvement simultaneously.Originality/valueFirst, the authors implanted fairness concerns into multi-stage venture capital and discussed the impact of fairness concerns on the efforts and returns of both parties. Second, among the influencing factors of the project output, the authors consider the bilateral efforts of EN and VC, the working capacity of EN, the initial investment scale, and the external uncertain environment.

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Risk investment decisions within the deterministic equivalent income model

Cited by 6 publications

References 43 publications

Suitability of risk assessment tools used during the portfolio recommendation process

Suitability of risk assessment tools used during the portfolio recommendation process

Determinan Pengambilan Keputusan Investasi Berdasarkan Norma Subjektif, Kontrol Perilaku, Dan Perilaku Heuristik

Venture investment under multi-stage incentive model based on fairness concerns

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