Personality Traits and Stock Investment of Individuals

Hamid SN, Mohd Amin SI. What factors affecting investment decision? The moderating role of fintech self-efficacy

This study aims to determine, from the perspective of investors, the factors that predict Islamic unit trust (IUT) investment intentions. Additionally, this paper examines the moderating effect of fintech self-efficacy (FSE) on the relationship between attitude and investment intention. A total of 392 data were collected from IUT investors in Malaysia and analyzed using partial least squares structural equation modeling. The findings reveal that subjective norms have the highest impact on investment intention, followed by attitude and FSE, while religiosity is not significantly associated with investment intention in Islamic unit trust funds. Attitude significantly mediates religiosity-intention and Islamic financial literacy-intention relationships. FSE significantly moderates the attitude-intention relationship. The results shed light on the key factors that increase investing behavior and have direct managerial implications with regard to marketing strategies and target markets. These findings suggest that IUT service providers should take the lead in attracting customers through effective and targeted marketing initiatives, particularly by enhancing customers' FSE and capabilities. This study provides empirical evidence on the interrelationships between Islamic financial literacy, religiosity, and FSE in examining investors' behavior using the Theory of Planned Behavior framework. The study explores the moderating role of FSE on the relationship between attitude and investment intention.

Enhancing purchasing stock intention in investor–brands interaction: the moderated mediation role of sector knowledge

Purpose

This study seeks to investigate the interrelationships among sector reputation, purchasing stock intention, sector engagement and attitude toward the sector. Moreover, it aims to explore the moderating role of sector knowledge in the indirect relationship between sector reputation and purchasing stock intention, mediated by sector engagement and/or attitude toward the sector.

Design/methodology/approach

Drawing upon the theory of planned behavior, the research framework is empirically tested. A survey involving 300 potential and actual investors was conducted, representing individuals investing in tourism brands within the Egyptian stock market. The validity and reliability of the constructs were assessed using AMOS, while Hayes’s PROCESS macro was employed to examine the mediation and moderated mediation effects.

Findings

The findings reveal that sector reputation significantly influences sector engagement, attitude toward the sector and purchasing stock intention. Furthermore, the attitude toward the sector serves as an explanatory factor for investors’ propensity to purchase stocks of tourism brands. The study confirms the serial mediation effect of sector engagement and attitude toward the sector, respectively, in the relationship between sector reputation and purchasing stock intention. Additionally, it confirms the moderated mediation role of sector knowledge in the relationship between sector reputation and purchasing stock intention, mediated by attitude toward the sector.

Practical implications

The research outcomes suggest that executives in the tourism industry should identify key determinants to enhance purchasing stock intention by fostering greater sector engagement and fostering positive attitudes toward the tourism sector.

Originality/value

This study contributes to the existing literature by shedding light on the importance of maintaining a positive brand reputation and emphasizing the influential role of investors’ knowledge, engagement and attitude in shaping investment decisions in the stock market. These insights contribute to the understanding of investor behavior and have practical implications for organizations in managing their brand reputation and fostering positive customer–brand interactions in the stock market context, thus the current study was conducted.

Personality traits and behaviour biases: the moderating role of risk-tolerance

The current research tries to contribute to the prospect theory by examining how personality factors affect behaviour biases. Moreover, the study tries to inspect how risk-tolerance behaviour moderates the relationship between personality traits and behavior biases. The research considered a cross-sectional research design to collect responses from 847 individual investors through a questionnaire. The study considered a convenience sampling technique. Further to examine the hypotheses, the study used SEM and PROCESS macro v3.0 for SPSS. The findings of the study suggest that conscientiousness and extroversion traits significantly influence behaviour biases. The findings also explain that neuroticism was associated with herding, disposition, and anchoring bias. The findings confirmed the moderating effect of risk-tolerance on the association between personality traits and behaviour biases. The findings contribute to the existing literature of behaviour finance by focusing on the prospect theory as well as some practical implications for investors and financial advisors. The study suggests to the individual investors with different traits how they can overcome these biases while investing. The study suggests that financial advisors should educate their clients and also establish a lock-gain point and stop-loss point to reduce the effect of such biases. The study also suggests that investment advisors should provide information more efficiently so that investors' portfolios could be amassed into a well-diversified investment and tries to set up efficient approaches associated with investment quality and give swapping options as per their risk-tolerance behavior. The research contributes to behaviour finance literature by signifying the moderation effect of risk tolerance on the association amid personality factors and behavioural biases and how it reduces the influence of biases while taking investment decisions among Indian investors. To the best of our knowledge, this is the first comprehensive study that examines the moderation effect of risk-tolerance among the relationship between personality traits and behaviour biases. Furthermore, it demonstrates that an individual's risk-tolerance enhances their involvement in the decision-making process, allowing them to make the best financial option possible.

Risk capacity and investment priority as moderators in the relationship between big-five personality factors and investment behavior: a conditional moderated moderated-mediation model

This paper aims to explore the relationship between big-five personality traits and investment behavior, particularly in the Indian context. Riding on the theory of planned behavior (TPB), we built a multi-layered moderated moderated-mediation model exploring the complex relationships between personality traits, investment attitude, and investment strategy. We collected data from 934 respondents from the southern part of India and analyzed using the Hayes (2018) PROCESS macros to test the hypotheses. The results indicate that (i) Personality traits (extraversion, emotional stability, conscientiousness, agreeableness, and openness to experience) are positively related to investment attitude and investment strategy, (ii) Investment attitude is positively related to investment strategy, (iii) Risk capacity moderates the relationship between personality traits and investment attitude, and (iv) Investment priority (second moderator) moderates the moderated relationship between personality traits, risk capacity (first moderator), and investment strategy mediated through investment attitude. Finally, the implications for behavioral finance and practicing managers are discussed.

Sell Winners and Buy Losers? The Impact of Familiarity on Individual Investors’ Decision-Making: Experimental Results

Purpose: This article analyzes the influence of familiarity bias on respondents’ decision-making process, using results from online experiments. Design/methodology/approach: A total of 255 research participants from post-Soviet countries completed 510 online tests that were presented in the form of investment games. In the games, the respondents were allowed to sell, buy, or hold two types of asset portfolios: familiar and unfamiliar assets. Findings: Holders of portfolios with familiar assets were 1.34 times more likely to be persistent in selling winners and holding losers and 1.10 times more likely to be persistent in buying fallen assets than holders of unfamiliar portfolios. Moreover, respondents who managed familiar assets tended to generate terminal result distributions with a kurtosis that was 27.8% higher than the distributions of those managing unfamiliar assets. Originality: Several academic studies have examined familiarity bias, the disposition effect, the positive feedback trading of individual investors, and risk-seeking trading; however, they investigated these topics separately. In the current study, we therefore created an online experiment to identify new aspects of investor behavior.

Psychological and Behavioural Responses to Coronavirus Disease 2019: The Role of Personality

This study examined the associations between personality traits and psychological and behavioural responses to the coronavirus disease 2019 (COVID-19) pandemic. Personality was assessed in January/February 2020 when the public was not aware of the spread of coronavirus in the USA. Participants were reassessed in late March 2020 with four sets of questions about the pandemic: concerns, precautions, preparatory behaviours, and duration estimates. The sample consisted of N = 2066 participants (mean age = 51.42; range = 18-98; 48.5% women). Regression models were used to analyse the data with age, gender, education, race, and ethnicity as covariates. Consistent with the preregistered hypotheses, higher neuroticism was related to more concerns and longer duration estimates related to COVID-19, higher extraversion was related to shorter duration estimates, and higher conscientiousness was associated with more precautions. In contrast to the preregistered hypotheses, higher neuroticism was associated with fewer precautions and unrelated to preparatory behaviours. Age moderated several trait-response associations, suggesting that some of the responses were associated more strongly in older adults, a group at risk for complications of COVID-19. For example, older adults high in conscientiousness prepared more. The present findings provide insights into how personality predicts concerns and behaviours related to the COVID-19 pandemic. © 2020 European Association of Personality Psychology.

Psychological and Behavioural Responses to Coronavirus Disease 2019: The Role of Personality

This study examined the associations between personality traits and psychological and behavioural responses to the coronavirus disease 2019 (COVID-19) pandemic. Personality was assessed in January/February 2020 when the public was not aware of the spread of coronavirus in the USA. Participants were reassessed in late March 2020 with four sets of questions about the pandemic: concerns, precautions, preparatory behaviours, and duration estimates. The sample consisted of N = 2066 participants (mean age = 51.42; range = 18-98; 48.5% women). Regression models were used to analyse the data with age, gender, education, race, and ethnicity as covariates. Consistent with the preregistered hypotheses, higher neuroticism was related to more concerns and longer duration estimates related to COVID-19, higher extraversion was related to shorter duration estimates, and higher conscientiousness was associated with more precautions. In contrast to the preregistered hypotheses, higher neuroticism was associated with fewer precautions and unrelated to preparatory behaviours. Age moderated several trait-response associations, suggesting that some of the responses were associated more strongly in older adults, a group at risk for complications of COVID-19. For example, older adults high in conscientiousness prepared more. The present findings provide insights into how personality predicts concerns and behaviours related to the COVID-19 pandemic. © 2020 European Association of Personality Psychology.