Advanced Financial Literacy of Malaysian Gen Y Investors and Its Consequences

Mohammad Tariqul Islam Khan, Siow-Hooi Tan and Gerald Goh Guan Gan

Margin: The Journal of Applied Economic Research, 2019, vol. 13, issue 1, 83-108

Abstract: This article presents the advanced financial literacy of Malaysian Gen Y investors and investigates whether literacy varies across demographics and ethnicity, and how financial literacy is related to investing decisions. In a survey-based study (N = 231) with the estimation of crosstab, ordered logistic regression and binary logistic regression, the results suggest that Gen Y investors display a medium level of financial literacy and that investors with certain demographic characteristics and ethnicity display a relatively higher level of financial literacy. Literacy items such as knowledge of stocks and bonds, functioning of the stock market, working of long-term bonds and mutual funds, and riskiness of bonds versus stocks are more closely related to investors’ trading, risky share investment, willingness of risk-taking, stock market participation and perceived portfolio returns. The results imply a clear scope to improve Gen Y investors’ financial literacy by concentrating on a certain socio-demographic groups and specific financial literacy items. JEL Classifications: D14, G11, I20

Keywords: Generation Y investor; Financial literacy; Demography; Ethnicity; Investment; Malaysia (search for similar items in EconPapers)
Date: 2019
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Persistent link: https://EconPapers.repec.org/RePEc:sae:mareco:v:13:y:2019:i:1:p:83-108

DOI: 10.1177/0973801018800085

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