Status Quo Bias and Risk Tolerance in Asset Allocation Decision-Making

This article examines status quo bias in terms of portfolio asset allocation, focusing on a sample of 572 real-world Italian investors affected by this bias from 2004 to 2017. The study investigates the effect on investors' risk tolerance of individual sociodemographic and socioeconomic characteristics, considering these variables both separately and simultaneously. Our results show that the combination of gender, marital status, and employment status can significantly explain the risk profile of portfolios held by investors affected by status quo bias over a long period. More specifically, gender and marital status are jointly fundamental in orienting investors' choices, while occupation status appears to act as a booster, exacerbating these behavioral tendencies.