Portfolio Reporting: How to Help individual Investors Learn from Past Mistakes

Project Start:01/2013
Researchers:Andreas Hackethal
Category: Household Finance
Funded by:LOEWE

The objective is to advance research on behavioral biases in investment decisions from problem analysis to testing possible solutions. Private households make numerous investment mistakes due to behavioral biases and on top hardly learn from their past investment decisions.

The aim of this research project is to evaluate one possible solution to make it easier for investors to assess their past performance and induce avoidance of past poor decision patterns in the future: short, standardized, post-contractual information on the portfolio performance in terms of return, risk, liquidity and costs.

After five rounds of report dissemination, the effects on investor behavior turned out to be insignificant on average. This result is reflected in a first working paper. In January 2015, after 12 rounds of report dissemination, clients who receive instructive reports behave significantly differently from control group clients. These interesting results will be presented in a second working paper that will be finished in March 2015.


Related Working Papers

No.Author/sTitleYearProgram AreaKeywords
157Sophie Ahlswede, Steffen Meyer, Linda UrbanDoes feedback on personal investment success help?2016 Household Finance household finance, field study, individual investors, reporting, investment mistakes, regulation