This webinar will take place on zoom.

René Levesley will investigate how investment decisions are made.

A unique data set, including both qualitative and qualitative data, from a large UK investment platform was used to assess how investment decisions are made. Many of the widely held theories around investment behaviour have been disproved and new insights identified.

The highest returns were achieved by investors who had a financial adviser. Financial advice reduces the number of trades placed, the amount of time spent obtaining information as well as eliminating or reducing the impact of biases. A number of biases were observed however, many of these did not actually lead to poor outcomes.

Overconfident investors spent more time obtaining information and placed more trades but this did not lead to lower returns. Overconfidence also had a significant impact on financial advice, differentiating whether investors seek advice and how it is consumed. Overconfident investors see a financial adviser as a consultant who they discuss investment ideas with and then make their own investment decisions, taking the credit for any excess returns achieved. Financial advice also moderates overconfident behaviours by reducing the number of trades placed and the amount of time spent obtaining information. Personality was found to have a very limited impact on investment decisions.

René Levesley has worked in financial services for over 20 years across a variety of companies, firms and sectors. He has a keen interest in what drives the investment decisions made by individuals. René is currently the Chief Risk and Compliance Officer at Profile Pensions and is in the final stages of a PhD in Economics.