The value of financial advice : an analysis of the investment performance of advised and non-advised individual investors

dc.contributor.advisorWest, Darronen_ZA
dc.contributor.authorAllie, Jahangiren_ZA
dc.date.accessioned2016-06-17T06:31:16Z
dc.date.available2016-06-17T06:31:16Z
dc.date.issued2015en_ZA
dc.description.abstractFinancial advisors have long been considered a part of the financial market through the advice that they offer investors. Behavioural finance has demonstrated that individual investors do not always behave in a rational manner, unlike financial advisors who seem not be prone to the behavioural biases that individuals experience when investment decisions are made. Furthermore, financial advisors have greater access to information, financial analytical tools, as well as better education in financial markets compared to the average individual. Financial advisors are thus better equipped to assist individual investors and provide them with improved investment results. This study investigated the value added by financial advisors in the investment performance of advised individual investors as opposed to non-advised individuals. The study wanted to establish whether financially advised individuals showed greater return on investments than non-advised individuals. A sample of individual investors from a large South African investment house were analysed across the investment categories of an advised investor and a non-advised investor for a period of 10 years from 1 January 2005 to 31 December 2014. The data was analysed to draw conclusions on returns, trading behaviour, the risk profile of investors and the reasons for differences identified. The results indicated that there is no statistical difference between the returns generated between advised investors, non-advised investors and the fund invested over the period. There was a statistical difference between the number of trades entered into by advised and non-advised investors, with advised investors making statistically more trades than nonadvised investors. There was no significant difference between the risk profiles of the investors based on qualitative data. The results indicate that there is no significant additional benefit of utilising a financial advisor, after the initial decision of which fund to invest in has been made.en_ZA
dc.identifier.apacitationAllie, J. (2015). <i>The value of financial advice : an analysis of the investment performance of advised and non-advised individual investors</i>. (Thesis). University of Cape Town ,Faculty of Commerce ,Department of Finance and Tax. Retrieved from http://hdl.handle.net/11427/20038en_ZA
dc.identifier.chicagocitationAllie, Jahangir. <i>"The value of financial advice : an analysis of the investment performance of advised and non-advised individual investors."</i> Thesis., University of Cape Town ,Faculty of Commerce ,Department of Finance and Tax, 2015. http://hdl.handle.net/11427/20038en_ZA
dc.identifier.citationAllie, J. 2015. The value of financial advice : an analysis of the investment performance of advised and non-advised individual investors. University of Cape Town.en_ZA
dc.identifier.ris TY - Thesis / Dissertation AU - Allie, Jahangir AB - Financial advisors have long been considered a part of the financial market through the advice that they offer investors. Behavioural finance has demonstrated that individual investors do not always behave in a rational manner, unlike financial advisors who seem not be prone to the behavioural biases that individuals experience when investment decisions are made. Furthermore, financial advisors have greater access to information, financial analytical tools, as well as better education in financial markets compared to the average individual. Financial advisors are thus better equipped to assist individual investors and provide them with improved investment results. This study investigated the value added by financial advisors in the investment performance of advised individual investors as opposed to non-advised individuals. The study wanted to establish whether financially advised individuals showed greater return on investments than non-advised individuals. A sample of individual investors from a large South African investment house were analysed across the investment categories of an advised investor and a non-advised investor for a period of 10 years from 1 January 2005 to 31 December 2014. The data was analysed to draw conclusions on returns, trading behaviour, the risk profile of investors and the reasons for differences identified. The results indicated that there is no statistical difference between the returns generated between advised investors, non-advised investors and the fund invested over the period. There was a statistical difference between the number of trades entered into by advised and non-advised investors, with advised investors making statistically more trades than nonadvised investors. There was no significant difference between the risk profiles of the investors based on qualitative data. The results indicate that there is no significant additional benefit of utilising a financial advisor, after the initial decision of which fund to invest in has been made. DA - 2015 DB - OpenUCT DP - University of Cape Town LK - https://open.uct.ac.za PB - University of Cape Town PY - 2015 T1 - The value of financial advice : an analysis of the investment performance of advised and non-advised individual investors TI - The value of financial advice : an analysis of the investment performance of advised and non-advised individual investors UR - http://hdl.handle.net/11427/20038 ER - en_ZA
dc.identifier.urihttp://hdl.handle.net/11427/20038
dc.identifier.vancouvercitationAllie J. The value of financial advice : an analysis of the investment performance of advised and non-advised individual investors. [Thesis]. University of Cape Town ,Faculty of Commerce ,Department of Finance and Tax, 2015 [cited yyyy month dd]. Available from: http://hdl.handle.net/11427/20038en_ZA
dc.language.isoengen_ZA
dc.publisher.departmentDepartment of Finance and Taxen_ZA
dc.publisher.facultyFaculty of Commerceen_ZA
dc.publisher.institutionUniversity of Cape Town
dc.subject.otherFinancial and Risk Managementen_ZA
dc.titleThe value of financial advice : an analysis of the investment performance of advised and non-advised individual investorsen_ZA
dc.typeMaster Thesis
dc.type.qualificationlevelMasters
dc.type.qualificationnameMComen_ZA
uct.type.filetypeText
uct.type.filetypeImage
uct.type.publicationResearchen_ZA
uct.type.resourceThesisen_ZA
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