@article {6720, title = {Risk Tolerance and Asset Allocation for Investors Nearing Retirement}, journal = {Financial Services Review}, volume = {9}, year = {2000}, pages = {159-170}, publisher = {9}, abstract = {This paper uses a large individual-level data set to isolate the effects of risk tolerance on portfolio composition. We test and confirm two predictions of the Capital Asset Pricing Model: (1) increased risk tolerance reduces an individual{\textquoteright}s propensity to purchase risk-free assets; and (2) higher risk tolerance does not affect the composition of an individual{\textquoteright}s portfolio of risky assets. More specifically, we find that risk tolerant investors nearing retirement do not reduce their bond allocations in order to buy more stock.}, keywords = {Net Worth and Assets, Risk Taking}, doi = {10.1016/S1057-0810(00)00063-9}, author = {Hariharan, Govind and Chapman, Kenneth S. and Domian, Dale L.} }