PARC Working Paper Series

Document Type

Working Paper

Date of this Version

7-1-2006

Comments

Muermann, Alexander and Jacqueline M. Volkman. 2006. "Regret, Pride, and the Disposition Effect." PARC Working Paper Series, WPS 06-07.

Abstract

We develop a dynamic portfolio choice model which incorporates anticipated regret and pride in individual's preferences and show that those preferences can cause investors to sell winning stocks and hold on to losing stocks; that is, anticipating regret and pride can help explain the disposition effect.

Keywords

Portfolio choice, Anticipated regret and pride, Individual preference, Disposition effect

Share

COinS
 

Date Posted: 11 March 2008