Presenter: Steffen Meyer, AU

Title: Private Investor Trading Motives and Performance in Innovative Financial Products

Abstract: Using a data set on German retail investors who trade structured financial products between 2000 and 2015, we investigate their characteristics as well as performance in these products and in the portfolio context. Users trade more, are less risk averse and have higher portfolio values. They are more experienced and less diversified. In general, investors generate small negative gross returns in leveraged structured financial products on the product level and in the portfolio context. Splitting investors based on their trading motives in these products shows that the negative performance stems from transactions that aim at hedging.

Organizers: Stefan Hirth and Anders Merrild Posselt