Health Status and Portfolio Choice: Hat Gesundheitszustand einen Einfluss auf die Risikoeinstellung?

  • Bressan, Silvia (Forscher*in)





Recent empirical work on individual portfolio choice focuses on the
effect of the health status on portfolio choice. Previous contributions sug-
gest that future health shocks can lead to higher medical spending which
absorbs the nancial wealth of the investor. In this view, health expenditures is a type of undiversiable background risk that induces precautionary saving and prompts safer portfolios. Moreover, a poor health status
might be perceived as a factor that shorten the individual time horizon,
with the direct consequence of setting up safer portfolio choices. In this
paper we focus on the relation between health status and stockholding, in-
vestigating the dierent potential channels through which health risk may
explicate an eect on investment decision consisting on a disaection from
the equity market and a decrease in the level of assumed nancial risk.
Using data from the rst wave of the Survey of Health, Aging and Retire-
ment in Europe (SHARE) we nd evidence of the negative eect of bad
health conditions on both stockholding and amount of risk carried by the
portfolio, even after controlling for a large set of individual and household
characteristics. We do not nd evidence of the fact that health insurance
or out-of-pocket medical expenses drive health eect on portfolio choice.
At the same time, our data do not support the idea that health risk is
suered mostly by older investors, who have shorter planning horizon. We
retain that, negative health shocks increase individual risk aversion and,
consequently, re
ect on nancial decisions. Interestingly, investment is
more aected by self-reported health than objective health. Changes in
portfolio holdings could be then encouraged with improvements in the long
term care, rather than in medical technology, since is the self-perception
of health that mostly has in
uence on portfolio composition.
Tatsächlicher Beginn/ -es Ende1/09/1031/01/12