The purpose of this study is to determine if gender can really affect financial decisions. We investigate the relationship between risk aversion, gender and overconfidence. We have conducted this study with a positivistic view and used a deductive approach starting to conduct a literature review of theories and build the study from this point. We relied largely on modern portfolio theory which has been expanded by researchers examining individual utility (risk theory or risk aversion) and behavioral aspects of investment behavior including overconfidence
The data for the study have been collected through surveying a very narrow target population, explicitly students at Umeå University. We used a strata sample with four strata units divided by gender and level of study in order to receive a wider perspective of the population; the units matched the proportion of students at Umeå School of Business. To measure the statistical difference between the genders we have used a statistical Chi2 test.
From the empirical findings and the analysis we have been able to draw some conclusions from our study. We found that there is a tendency among women to have a higher degree of risk aversion than men. This implies that women would take a lower risk when managing an investment portfolio. We also could conclude that men and women are similar in their level of confidence when it comes to financial decisions.
Source: Umeå University
Author: Berggren, Jonas | Romualdo, Gonzalez