Behavioral biases and investors’ decision-making: The moderating role of socio-demographic variables

Naveeda K. Katper (), Muhammad Azam, Nazima Abdul Karim () and Syeda Zinnaira Zia ()
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Naveeda K. Katper: Institute of Business Administration, University of Sindh, Jamshoro, Sindh, Pakistan
Muhammad Azam: #x2020;Faculty of Management Sciences, Iqra University, Karachi 75500, Sindh, Pakistan
Nazima Abdul Karim: #x2021;Department of Business Administration, Iqra University, Karachi 75500, Sindh, Pakistan
Syeda Zinnaira Zia: #x2021;Department of Business Administration, Iqra University, Karachi 75500, Sindh, Pakistan

International Journal of Financial Engineering (IJFE), 2019, vol. 06, issue 03, 1-15

Abstract: The purpose of this study is to investigate the impact of behavioral biases on investment decision, and the interaction effect of socio-demographic characteristics. Data were collected from a sample of 179 individual investors in the Pakistan Stock Exchange (PSX). The authors conducted a hierarchical regression analysis to test the moderating effect of socio-demographic variables on behavioral biases. The results show that behavioral biases have a significant impact on investors’ decision-making. Moreover, socio-demographic variables (education, occupation and marital status) moderate the relationship between emotional biases and investors’ decision-making. This study provides a new addition to prior literature by investigating the impact of behavioral biases on investors’ decision-making, and the interaction effect of socio-demographic characteristics.

Keywords: Behavioral finance; emotional biases; investors’ decision-making; socio-demographic characteristics (search for similar items in EconPapers)
Date: 2019
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Citations: View citations in EconPapers (2)

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DOI: 10.1142/S2424786319500208

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