Investors allocate less to risky assets with downside risk information.
Investors tend to invest less in risky assets when they are given information about potential losses, even if they are not particularly risk-averse. This goes against the idea that investors always aim to maximize their gains. The study shows that when investors are provided with explicit downside risk information, they choose to allocate less money to risky assets, which suggests they are influenced by a fear of losing money rather than just seeking higher returns.