On the determinants of portfolio choice

B Frijns, E Koellen, T Lehnert

Research output: Contribution to journalArticleAcademicpeer-review


This paper jointly analyzes traditional and behavioral concepts in a simple experimental setting which allows for the assessment of the relative importance of each factor and their joint behavior. Various hypotheses are tested in three portfolio choice models. Markowitz [Markowitz, H., 1952. Portfolio selection. Journal of Finance 7, 77–92] findings are analyzed and extended by behavioral concepts and socio-demographic variables. Models are expressed as conjoint choice models represented by a multinomial logit model. Data is collected in an experimental setting. We show that the level of the risk-free rate, an individual's risk aversion, market sentiment, self-assessed financial expertise, age and gender are determining factors of portfolio choice.
Original languageEnglish
Pages (from-to)373-386
Number of pages14
JournalJournal of Economic Behavior & Organization
Issue number2
Publication statusPublished - May 2008
Externally publishedYes


  • Investor behavior
  • Market sentiment
  • Portfolio choice
  • Risk aversion


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