SSRN-Does Investment Skill Decline Due to Cognitive Aging or Improve with Experience? by George Korniotis, Alok Kumar:
"The economic costs of aging are considerable - older investors earn roughly 2% lower annual returns on a risk-adjusted basis. Collectively, our results are consistent with the hypothesis that older investors' portfolio choices reflect greater knowledge about investing but their investment skill deteriorates with age...."While I am a tad unwilling to chalk up the lower returns totally to "declining congnitive abilities" (it could be that they are "out of the loop" and hence more uninformed), it is an interesting look at how aging affects investing.
Actually I am surprised this one hasn't had more play in the popular press! I just googled it and it did appear on MoneyScience, but no where else appeared. Weird.
Korniotis, George M. and Kumar, Alok, "Does Investment Skill Decline Due to Cognitive Aging or Improve with Experience?" (January 2006). Available at SSRN: http://ssrn.com/abstract=767125