Cynthia Balloch - LSE

Abstract

We survey financial advisors to elicit their subjective beliefs about asset returns and the macroeconomy. Our bespoke survey design captures both short-term and
long-term return expectations for multiple asset classes, as well as the minimum acceptable rate of return. This allows us to decompose return expectations into two subjective components: required returns and excess returns (alpha). These two components play distinct roles in explaining belief heterogeneity: required returns drive variation in long-term expectations, while excess returns dominate short-term expectations. By linking survey responses to the portfolios managed by the same advisors, we further demonstrate that portfolio decisions are more sensitive to excess returns than to required returns.

Additional information:

• Speaker: Cynthia Balloch 
• Time: Wednesday, 07.05.2025, 14:45 - 16:00
• Location: Faculty Lounge, Room 0.036
• Further links:
  • Cynthia Balloch 's webpage¹
• Organizer: Finance Group
• Contact:
  • Almut Lunkenheimer
  • +49 228 73-9228
  • ifs@uni-bonn.de