Microsoft Word Ed Horwitz Post Dissertation Fina docx

 Stocks and Securities Ownership 
It has been well established in historical literature that those with lower levels of financial 
literacy tend to avoid the stock market and stock ownership (Christelis, Jappelli, & Padula, 2006; 
Kimball & Shumway, 2006; Lusardi & Mitchell, 2009; van Rooij et al., 2011). Ignorance of 
basic financial concepts, such as compound interest, the impacts of inflation, and risk 
diversification, has been linked to the lack of stock ownership and stock market participation 
(van Rooij et al., 2011; Lusardi, 2008). Investment in the stock market has historically provided 
long-term growth that helps keep pace with inflation and the ability to diversify risk through 
portfolio investing or mutual funds. For these reasons noted in the historical literature, those with 
greater financial knowledge have been associated with stock market participation and higher 
levels of accumulated wealth. The ownership of stock or securities embodies higher levels of 
knowledge important in understanding the benefits of diversification, inflation protection, long-
term growth, and greater wealth accumulation, and is thereby considered a best practice behavior 
for retirement preparedness. 

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