Personality Traits,Social Interacton And Household Portfolio Allocation

With the growing disposable income of households and the accumulation of households wealth,the influence of households in financial markets is becoming increasingly important.A large number of research at domestic and abroad has begun to pay attention to the problem of household asset allocation.Studies have shown that in addition to the influence of traditional factors,the household asset allocation is closely related to personality traits and social interaction.Household investors with different personality characteristics make different economic decisions even if they face the same preferences,expectations and constraints.Social interaction is an important channel for investors to obtain the information that they need,and they also make economic decisions by discussing or learning with other reference groups.Firstly,this paper summarizes the relevant theories and literatures about personality traits,social interaction and household asset allocation,and proposes the hypothesis about the relationships between them.Secondly,by constructing the proxy variables of personality traits and the variables of social interaction,we use the consumption financial data of urban household surveyed by the China Center For Finance Research(CCFR)of Tsinghua University to examine the influence of personality traits and social interaction on household asset allocation.Finally,by building a model of the effect of mediation,we examine the mediating effect of social interaction.The results show that the dimension of Conscientiousness and Agreeableness have a significant impact on the household asset allocation,and the influence of other personality characteristics is not significant.The endogenous interaction of social interaction has a significant impact on the household asset allocation and the impact of scenario interaction is not significant.The personality traits can affect the household asset allocation through the mediating effect of social interaction.Conscientiousness has an impact on household asset allocation through the full mediating effect of endogenous interaction.Agreeableness has an impact on household asset allocation through the partial mediating effect of endogenous interaction.Based on the research results,we propose corresponding policy recommendations from three aspects:personality traits,financial institutions and regulatory agencies.