Non‐professional investors' behavior: an empirical study of female Saudi investors

Abstract

PurposeThe purpose of this paper is to investigate the factors that may affect female Saudi students who are considered potential non‐professional investors.Design/methodology/approachA structured questionnaire was distributed to the participants; the obtained data were analyzed using the probit model and the Likert scale.FindingsThe results indicate that female students are more likely to own stocks if they have a high level of financial education. Variables such as age, income, grade point average (GPA), grade obtained in financial courses, and risk tolerance also affect stock ownership decision. The respondents also depend on 21 factors to analyze and evaluate stocks before making investment decisions.Originality/valueSeveral studies have been conducted on investors' behavior; however, few of them have focused on non‐professional investors and none of these has focused on young, educated, female Saudi investors.

Influence of financial literacy on retail investors' decisions in relation to return, risk and market analysis

“…However they always crave for more information and are seldom satisfied with the information provided by the companies and the stock brokers (Gupta, 1991). Risk, company reputation, earning per share (EPS), price‐earnings ratio (P/E), and volatility of stock price strongly influence retail investors' decisions (Heshmat, 2012; Huston, 2010).…”

Decisions for Stock Investment among University Students

“…Investments in the capital market can be done by investors for three basic objectives, namely maximizing wealth, maintaining liquidity, and minimizing risk. In this study, stock objectives have four indicators namely short-term capital gains, long-term capital appreciation, dividends, and minimizing risk [11]. The first indicator is the short-term capital gains which are the benefits obtained when stock prices increase.…”

“…Due to the behavior of the stock market and new information, stock investors will make a decision for their investment. There are five indicators that support information source factors, namely the recommendation of family and friends, recommendations of financial consultants, magazines or newspapers, annual reports, and computers or the internet [11].…”

“…In making investment decisions, many factors are considered by investors. According to Heshmat [11], stock investment decisions are influenced by several factors, namely demographic factors, risk tolerance, objective factors, information source factors, market factors, company factors, and stock fundamental factors. The first factor is the demographic factor.…”

Short-term versus Long-term Investments: A Study of Women Stock Investors of Punjab

“…Short term capital gains and long term capital appreciation are important factors influencing the investment decisions of every investor (Heshmat, 2012). Academic researchers are of the view that long term financial images tend to be more positive than short-term financial images (Hemingway, 2009).…”