How diversified are household asset portfolios?

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Author(s)
West, Tracey
Worthington, Andrew C
Griffith University Author(s)
Year published
2018
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Households face constraints that limit the extent to which they can optimally diversify their asset portfolios in line with Markowitz portfolio theory. This study measures the diversification of Australian households using four alternative measures better suited to households and successive waves of the Household, Income, and Labor Dynamics in Australia (HILDA) Survey. We examine how these measures of diversification vary across time and the population. We find that diversification is generally poor and varies significantly by wealth, age, household structure, and financial stance and risk. Index Terms - Asset portfolios, ...
View more >Households face constraints that limit the extent to which they can optimally diversify their asset portfolios in line with Markowitz portfolio theory. This study measures the diversification of Australian households using four alternative measures better suited to households and successive waves of the Household, Income, and Labor Dynamics in Australia (HILDA) Survey. We examine how these measures of diversification vary across time and the population. We find that diversification is generally poor and varies significantly by wealth, age, household structure, and financial stance and risk. Index Terms - Asset portfolios, Diversification, Household socioeconomic and demographic characteristics, Financial risk-taking.
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View more >Households face constraints that limit the extent to which they can optimally diversify their asset portfolios in line with Markowitz portfolio theory. This study measures the diversification of Australian households using four alternative measures better suited to households and successive waves of the Household, Income, and Labor Dynamics in Australia (HILDA) Survey. We examine how these measures of diversification vary across time and the population. We find that diversification is generally poor and varies significantly by wealth, age, household structure, and financial stance and risk. Index Terms - Asset portfolios, Diversification, Household socioeconomic and demographic characteristics, Financial risk-taking.
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Journal Title
International Journal of Management and Applied Science
Volume
4
Issue
3
Publisher URI
Copyright Statement
© 2018 Institute of Research and Journals. The attached file is reproduced here in accordance with the copyright policy of the publisher. Please refer to the journal's website for access to the definitive, published version.
Subject
Banking, finance and investment not elsewhere classified