Abstract Using a questionnaire method, this study presents new evidence on the determinants ofrisk tolerance of individual investors in Bahrain. On the basis of an,analysis of close to 1,500 respondents, the findings indicate that as investors, men have high propensity towards risk tolerance than women. Investors with better level of education and wealth are more likely to seek,risk than less educated and less wealthy ones. The study also reports that investors’ risk tolerance declines when,they have more financial commitments,as well as when they are approaching towards their retirement age or are retired. That is, the effect ofinvestor’s age on risk tolerance is complex, in contrast to results reported elsewhere. Bahrainis are also found to be ,less risk tolerant than non-Bahrainis. One of the ,most important implications of the ,results is that the ,investment ,industry should ,not treat investors as one homogeneous group; therefore, men and women as investors should be treated as separate market niches, each with its own needs and requiring targeted marketing strategies. Investment companies and financial service marketers should design investment programs to respond to the particular needs of women investors, men investors, investors with particular education and age levels, wealthy investors, and expatriate investors. Keywords: Bahrain, behavioral finance, gender differences, life cycle, risk tolerance, wealth.
Risk Tolerance of Individual Investors in an Emerging Market. Available from: http://www.researchgate.net/publication/252602762_Risk_Tolerance_of_Individual_Investors_in_an_Emerging_Market [accessed Jul 19, 2015].