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- Title
Investor Prudence and the Role of Financial Advice.
- Authors
Winchester, Danielle D.; Huston, Sandra J.; Finke, Michael S.
- Abstract
Investors have difficulties making optimal long-term financial decisions for reasons such as shortsightedness, a lack of financial sophistication, and an inability to self-regulate. Using propriety data collected during the 2007 recession, a period where investors lost over $8 billion by making impulse investment decisions, this study examines the impact of professional financial advice on an investor's commitment to long-term financial goals. Results suggest that investors who use a financial advisor are about one-and-a-half times more likely to adhere to longterm investment decisions. Additionally, investors with a written financial plan are almost twice as likely to make optimal long-term financial decisions.
- Subjects
UNITED States; INVESTMENT advisors; INVESTORS; DECISION making; RECESSIONS; IMPULSE (Psychology)
- Publication
Journal of Financial Service Professionals, 2011, Vol 65, Issue 4, p43
- ISSN
1537-1816
- Publication type
Article