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Portfolio Adviser: Asking fund managers sensitive questions about their childhood


A study co-authored by Raghu Rau, Sir Evelyn de Rothschild Professor of Finance at Cambridge Judge Business School, found that fund managers who experienced the death or divorce of a parent in their childhood go on to take significantly less risk when managing their own funds – and invest less in “lottery-like” stocks. “You lose your friend, you lose your parent, that’s the part of the brain which is affected,” Professor Rau says. “That’s also the same part of the brain which is impacted when you’re taking risk and when you’re choosing when to take risk or not.”

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