Adding risks: Some general results about time diversification

Authors
Publication date 2000
Series Tinbergen Institute Discussion Paper, TI 2000-063/3
Number of pages 13
Publisher Amsterdam / Rotterdam: Tinbergen Institute
Organisations
  • Faculty of Economics and Business (FEB) - Amsterdam Business School Research Institute (ABS-RI)
Abstract We show in general that risky investments become more attractive asthe investment horizon (n) lengthens.Specifically, any investor's maximal expected utility directlyincreases with n, as well as the investor's willingness toallocate more capital to the risky assets if his optimal strategy isbounded by the leverage constraint.
Document type Working paper
Language English
Published at http://papers.tinbergen.nl/00063.pdf
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