Saltar al contenido principal
logo

The Academy of Financial Services 35th Annual Meeting

del 21 al 22 de September del 2021

Virtual

Evaluating Non-financial Preferences Using a Modified MaxDiff

miércoles, el 22 de septiembre de 2021 a las 14:15–15:15 EDT add to calendar
Virtual
Keywords

ESG, Revealed Preferences, Non-financial, MaxDiff

Short Description

Financial planners evaluate a client’s risk tolerance and other factors to determine suitable risk/return trade-offs in the generation of pecuniary portfolio advice. Current sustainability trends globally have escalated the focus on evaluating non-pecuniary objectives of the client beyond traditional faith-based issues to more mainstream Environment, Social and Governance concerns. This research utilized a three-step assessment of consumers to determine their interest in integrating non-financial issues of concern with the construction of their portfolio. It determined the magnitude of their interest based on a willingness to pay, and finally applied a modified MaxDiff Analysis to present a series of three option choices between 6 self-selected issues of significance and 3 return trade-offs scaled to the commitment level of the consumer. The modification in the MaxDiff was a continuous scale, sum to 100, for the three choices which allowed additional granularity at the cost of increase noise in responses.

Lead & Corresponding Author

[photo]
Shawn Brayman, Morningstar
Job Title

Director of Financial Planning Methodology

Email Address

Additional Authors

Cargando…