Measuring the Effects of Risk and Cultural Dimensions on the Adoption of Online Stock Trading: A Developing Country Perspective

Safeer Ullah Khan, Xiangdong Liu, Ikram Ullah Khan, Cheng Liu and Zahid Hameed
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Safeer Ullah Khan: Donlinks School of Economics and Management, University of Science and Technology Beijing, Beijing, China
Xiangdong Liu: Donlinks School of Economics and Management, University of Science and Technology Beijing, Beijing, China
Ikram Ullah Khan: Institute of Management Sciences, University of Science and Technology Bannu, KP, Pakistan
Cheng Liu: Donlinks School of Economics and Management, University of Science and Technology Beijing, Beijing, China
Zahid Hameed: Department of Management, Khwaja Fareed University of Engineering & IT, Rahim Yar Khan, Pakistan

International Journal of Enterprise Information Systems (IJEIS), 2018, vol. 14, issue 3, 106-127

Abstract: Online stock trading (OST) is a growing phenomenon across countries, yet there is a sparse literature focusing on the negative utilities (risks) that causing the low adoption. Drawing from perceived risk theory, this article attempts to fill the gap by identifying the influential risk factors that impede the acceptance of OST in a developing country, Pakistan. The study also applies the Hofstede cultural theory to ascertain the effects of cultural moderators on investors' usage behavior (UB). Based on structured questionnaire, 443 valid responses were received from current and potential investors. The model was tested using structural equation modeling through Smart-PLS. The results validate a negative and significant relationship between risk dimensions and investors' behavioral intentions (BI) to use OST. Especially time, financial, performance, privacy and opportunity cost risks are found having a negative impact on investors' BI. Moreover, the study finds that cultural dimensions, collectivism, and uncertainty avoidance, moderate the relationship between BI and UB.

Date: 2018
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Persistent link: https://EconPapers.repec.org/RePEc:igg:jeis00:v:14:y:2018:i:3:p:106-127

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