Analysis of Households’ Investment Decisions Based on International Data

The paper attempts to pinpoint the economic, demographic and risk-taking factors that influence households’ demand for risky financial assets, using the Household Finance and Consumption Survey (HFCS) database as the basis for the analysis. From the perspective of risky asset holding, supply is also important, and therefore clustering was used to identify several country groups based on capital market features. The study mainly focuses on the countries that are, similar to Hungary, less active based on their capital market features, but the characteristics of countries with a more active capital market are also presented for comparison. In line with the empirical literature, demand for risky assets is examined using econometric tools, isolating the effect of the significant factors. Accordingly, separate logit models were created for the demand factors in the different country groups under review, i.e. those with a less mature and those with a highly mature capital market. The results indicate that income, wealth, skills and risk-taking positively influence risky asset holding, while liquidity constraints and background risks have a negative influence; the findings confirm the preliminary expectations and can be deemed robust.