Proceedings of the 5th Padang International Conference On Economics Education, Economics, Business and Management, Accounting and Entrepreneurship (PICEEBA-5 2020)

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Individual Traits, Risk Perception, Financial Literacy & Investment Decisions

Authors
Ni Luh Putu Sipta Dewi Anindita, Maria Ulpah
Corresponding Author
Ni Luh Putu Sipta Dewi Anindita
Available Online 27 November 2020.
DOI
10.2991/aebmr.k.201126.061How to use a DOI?
Keywords
investment decisions, financial literacy, individual traits, risk perception
Abstract

The preferences of individual investors in making investment decisions are not only based on rational behavior like conventional financial science. Behavioral finance integrates a broad social science perspective in research in the field of financial economics. In this study, we investigate the variables that influence investment decisions in individual investors. The purpose of this study is to find out whether individual traits, risk perception and financial literacy affect investment decisions. We tested multiple linear regression with 475 survey respondents. We find that individual traits variables measured by emotional intelligence and locus of control affect the choice of investment instruments for individual investors. Individual traits variable measured by characteristic didn’t affect investment decision. Risk perception affects investment decisions. Individual traits and risk perception variables were measured by several survey questions. We also find that financial literacy as measured by the scoring method influences investment decisions but not by financial literacy as measured by self-assessment. Only 37.47% (178 out of 475 people) respondents answered correctly over 80% of the financial literacy questions. Our result imply that policy makers should be careful to put financial advice forward as a mechanism to curb the ill effect of low financial literacy.

Copyright
© 2020, the Authors. Published by Atlantis Press.
Open Access
This is an open access article distributed under the CC BY-NC license (http://creativecommons.org/licenses/by-nc/4.0/).

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Volume Title
Proceedings of the 5th Padang International Conference On Economics Education, Economics, Business and Management, Accounting and Entrepreneurship (PICEEBA-5 2020)
Series
Advances in Economics, Business and Management Research
Publication Date
27 November 2020
ISBN
978-94-6239-280-9
ISSN
2352-5428
DOI
10.2991/aebmr.k.201126.061How to use a DOI?
Copyright
© 2020, the Authors. Published by Atlantis Press.
Open Access
This is an open access article distributed under the CC BY-NC license (http://creativecommons.org/licenses/by-nc/4.0/).

Cite this article

risenwbib
TY  - CONF
AU  - Ni Luh Putu Sipta Dewi Anindita
AU  - Maria Ulpah
PY  - 2020
DA  - 2020/11/27
TI  - Individual Traits, Risk Perception, Financial Literacy & Investment Decisions
BT  - Proceedings of the 5th Padang International Conference On Economics Education, Economics, Business and Management, Accounting and Entrepreneurship (PICEEBA-5 2020)
PB  - Atlantis Press
SP  - 553
EP  - 559
SN  - 2352-5428
UR  - https://doi.org/10.2991/aebmr.k.201126.061
DO  - 10.2991/aebmr.k.201126.061
ID  - Anindita2020
ER  -