Previous literature has produced mixed findings of a tendency of investors, coined the “ostrich effect” to display a preference for avoiding potentially painful information regarding their portfolios. This paper investigates the presence of the ostrich effect during the 2008/2009 financial crisis via a survey of investors who held portfolios before and through that period. The results demonstrate that most investors do not report any ostrich effect. However, approximately one fourth of investors demonstrated a preference for delaying learning about potentially negative portfolio information, but ultimately chose to learn the information. These findings provide a more nuanced understanding of investors’ behaviors during financial crises and supports a more specific definition of the ostrich effect. Specifically, that some investors prefer a delay in painful information acquisition but do no indefinitely “keep their heads in the sand.”
| Identifer | oai:union.ndltd.org:CLAREMONT/oai:scholarship.claremont.edu:scripps_theses-2285 |
| Date | 01 January 2019 |
| Creators | Gabriel, Kira Knowles |
| Publisher | Scholarship @ Claremont |
| Source Sets | Claremont Colleges |
| Detected Language | English |
| Type | text |
| Format | application/pdf |
| Source | Scripps Senior Theses |
| Rights | © 2018 Kira K Gabriel, default |
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