The Effect Of Financial Literacy, Overconfidence, And Risk Tolerance On  Investment Decision

Yulianis, Nur; Sulistyowati, Erna

doi:10.33005/ebgc.v4i1.172

Cited by 12 publications

(23 citation statements)

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“…Moreover, the estimated regression result of this research (=0.514) indicates the positive and significant (t-statistics 7.139>1.96 & P-value 0.000<0.01) impact of the overconfidence on the investment decision-making process in Nepal. This result is consistent with the theory of financial behavior, and the result supports the prior findings of [30], [29], [33], [34], [36], [39], [40], [42], [44], [43], [45],…”

Section: Discussionsupporting

confidence: 92%

“…They revealed investment decisions are significantly influenced by herd behavior and loss aversion. In investigating the effect of overconfidence, financial literacy, and risk tolerance on investment decisions, Yulianisa and Erna Sulistyowati [36] applied multiple linear regression models and observed that overconfidence and financial literacy have a significant influence. In contrast, risk tolerance does not affect investment decisions.…”

Section: Introductionmentioning

confidence: 99%

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Risk Tolerance, Overconfidence and Investment Decisions in Nepal

Pitambar Lamichhane,

Arogya Simkhada

2024

J.Gen.Educ.Humanit.

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In the present globalized, modernized and digitalized business environment, investors are attracted to the stock market for their investment in financial assets rather than real assets. Investors' Investment decisions are affected by various factors affecting their investment in financial assets in the stock market. This research intends to address problems of how investors’ psychological factors (risk attitude & overconfidence) influence their investment decisions. Therefore, this paper examines the impact of investors’ risk tolerance capacity and overconfidence level on investors’ investment decisions in Nepal. This study has applied descriptive and causality (regression) research designs to investigate the effect of risk tolerance and overconfidence on investment decisions based on financial behavior theories. Data were obtained through the structured questionnaire survey. Investment decision-making is considered a dependent variable in this research, and risk tolerance and investors' overconfidence levels are used as explanatory variables. The correlation result reveals positive associations between explanatory variables and investment decisions. The regression result of this research study concludes that risk tolerance capacity and overconfidence level both significantly impact investors’ investment decisions in the Nepalese stock market. Therefore, policymakers, regulatory bodies, decision makers, market traders, and academics should focus on investors’ risk tolerance ability and overconfidence level to enhance investors' ability to make sound investment decisions to maximize their returns and minimize risk in Nepal.

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Section: Discussionsupporting

confidence: 92%

Section: Introductionmentioning

confidence: 99%

Risk Tolerance, Overconfidence and Investment Decisions in Nepal

Pitambar Lamichhane,

Arogya Simkhada

2024

J.Gen.Educ.Humanit.

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“…The millennial investors in this study who invested in the Sharia capital market possess risk tolerance that did not have a significant impact on their investment decisions, according to previous research (Ady & Hidayat, 2019;Hidayat, 2022;Yulianis & Sulistyowati, 2021). They did not overestimate risks when making investment decisions in the Sharia capital market.…”

Section: The Effect Of Risk Tolerance On Investment Decisionsmentioning

confidence: 47%

“…Risk-averse investors, on the other hand, prefer to avoid existing risks (Pradikasari & Isbanah, 2018). Types of risk tolerance influence investment decisionmaking Budiarto & Susanti, (2017); Fridana & Asandimitra, (2020); Hikmah et al, (2020); Lathifatunnisa & Wahyuni, (2021) although in some other studies, they do not (Ady & Hidayat, 2019;Hidayat, 2022;Yulianis & Sulistyowati, 2021). Using the previous results to hypothesize, this current study formulated a hypothesis that is: H5: Risk tolerance has a positive significant effect on investment decisions.…”

Section: The Influence Of Risk Tolerance On Investment Decisionsmentioning

confidence: 87%

Determinants of Millennial Investment Decision-Making in the Sharia Capital Market: A Comprehensive Review

Aeni,

Tubastuvi,

Purwidianti

et al. 2024

JEBA

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Introduction: The study aims to examine the impact of financial literacy, overconfidence, regret aversion bias, herding, and risk tolerance on the investment decisions of the Indonesian millennial generation. Methods: The study used a quantitative approach with a sample of 120 respondents from the millennial generation who invested in the Islamic capital market. A statistical test was done using SPSS IBM 26. Results: Financial literacy and overconfidence significantly influenced investment decisions. On the other hand, regret aversion bias, herding, and risk tolerance had no significant impact on investment decisions. Conclusion and suggestion: The study concluded that financial literacy and overconfidence are the major factors that affect the investment decisions of the Indonesian millennial generation. The government (regulator) and related institutions should take a more proactive approach in providing outreach and education about the importance of financial literacy and overconfidence. The millennial generation is interested in investing in the Sharia capital market.

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“…Sehingga dari upaya tersebut, membuat semakin terbukanya peluang bagi mahasiswa untuk berinvestasi. Namun, dengan meningkatnya minat dalam berinvestasi justru dimanfaatkan sejumlah pihak untuk melakukan kecurangan dengan berkedok investasi (Yulianis & Sulistyowati, 2021). Kepopuleran instrumen investasi tertentu dapat menyita perhatian anak muda untuk berinvestasi.…”

Section: Pendahuluanunclassified

Literasi Keuangan dan Pendapatan terhadap Keputusan Investasi Mahasiswa dengan Perilaku Keuangan sebagai Variabel Intervening

Putri

Andayani²

2022

JOMB

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This study aims to determine the effect of financial literacy, income, and financial behavior as intervening variables on investment decisions of active undergraduate students of accounting at UPN "Veteran" East Java. The population in this study were active students majoring in accounting at UPN "Veteran" East Java who had worked or were self-employed. The research method used is a quantitative method. The data collection method was carried out using a questionnaire in the form of a Google form. The analysis technique used is Partial Least Squares (PLS) with the help of SmartPLS 3.0 software. The results showed that financial literacy and financial behavior had a positive and significant effect on investment decisions, while income had no effect on investment decisions. Financial literacy has a positive and significant effect on financial behavior while income has no effect on financial behavior. In addition, the mediation test results show that financial behavior mediates the relationship between financial literacy and investment decisions and does not mediate the relationship between income and investment decisions. Keywords: Investment Decision, Financial Literacy, Income, Financial Behavior

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The Effect Of Financial Literacy, Overconfidence, And Risk Tolerance On Investment Decision

Cited by 12 publications

References 0 publications

Risk Tolerance, Overconfidence and Investment Decisions in Nepal

Risk Tolerance, Overconfidence and Investment Decisions in Nepal

Determinants of Millennial Investment Decision-Making in the Sharia Capital Market: A Comprehensive Review

Literasi Keuangan dan Pendapatan terhadap Keputusan Investasi Mahasiswa dengan Perilaku Keuangan sebagai Variabel Intervening

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