Portland State study points to connection between religion and risk

February 06, 2018

Research co-authored by Portland State University finance professor Jing Zhao found that the religious beliefs of the population in counties where hedge funds are headquartered influence the riskiness of hedge fund managers' portfolios.

The findings, published in a recent issue of the Journal of Corporate Finance, found that fund managers in counties where the population was more religious took fewer risks with their investments than those where religious was less of a factor.

The study examined more than 7,000 hedge funds throughout the United States and checked them against the religious data of the counties where they are headquartered. It even looked into the level of religious beliefs of the college locations where fund managers attended.

The more risk-averse funds where religion played a role tended to be smaller and younger funds, which are more dependent on local investors and local management teams. This negative effect of religiosity on risk-taking was even more pronounced during periods of financial crisis. The study found that funds located in more religious counties tend to hold more diversified portfolios than the norm. Yet despite their lower-than-average risk, the funds produced returns on par with the industry average.

"The overall evidence indicates that indeed local religious beliefs instill a risk-aversion culture to the hedge fund industry," Zhao said. "This gives strong support for the idea that local culture, in particular local religiosity, has an impact on organizational risk taking."
-end-


Portland State University

Related Religious Articles from Brightsurf:

Explaining the religious vote for Trump
New research by Louisiana State University sociologists indicate it wasn't Christian nationalism that drove churchgoers' Trump vote in 2016.

Shared religious experiences bring couples together
Couples that pray together stay together. It's a common religious saying, but a new study from the University of Georgia is giving the proverb some scientific credence.

Muslims, atheists more likely to face religious discrimination in US
A new study led by the University of Washington found that Muslims and atheists in the United States are more likely than those of Christian faiths to experience religious discrimination.

Religious believers think God values lives of out-group members more than they do
In a new paper, which will appear in print in an upcoming special issue of Social Psychological and Personality Science, Michael Pasek, Jeremy Ginges, and colleagues find that, across religious groups in Fiji and Israel, religious believers see God as encouraging people to treat others in a more universal, or equal, manner.

Kitsch religious souvenirs can rekindle pilgrimage experience
'Tacky and 'kitsch' religious souvenirs brought back from pilgrimage sites offer pilgrims and their friends and family who cannot make the journey a deeper religious connection.

Few people consider religious affiliation of hospital they choose
A small minority of Americans surveyed consider the religious affiliation of the hospitals that treat them, but a majority said they didn't want religious doctrine dictating their healthcare choices, according to a study by researchers at the University of Colorado Anschutz Medical Campus.

Developed countries may become more religious in 20 years
Researchers from HSE University and RANEPA found that in high-income countries, age, rather than the cohort effect, has more impact on religiosity.

AI systems shed light on root cause of religious conflict
Artificial intelligence can help us to better understand the causes of religious violence and to potentially control it, according to a new Oxford University collaboration.

Religious leaders' support may be key to modern contraception
Women in Nigeria whose clerics extol the benefits of family planning were significantly more likely to adopt modern contraceptive methods, new research suggests, highlighting the importance of engaging religious leaders to help increase the country's stubbornly low uptake of family planning services.

UC political scientist reveals surprising answers about religious freedom
Can political conservatives accept inclusive religious freedom rights when viewing similar issues from another perspective?

Read More: Religious News and Religious Current Events
Brightsurf.com is a participant in the Amazon Services LLC Associates Program, an affiliate advertising program designed to provide a means for sites to earn advertising fees by advertising and linking to Amazon.com.