Investigating the effect of financial literacy, self-confidence, and emotional intelligence on investors' risk-taking in the Tehran Stock Exchange
Subject Areas : Financial engineering
Hamid Abbasi
1
,
Amir Mohammadzadeh
2
*
,
Mohsen Torabian
3
1 - Department of Financial Engineering, Qazvin Branch, Islamic Azad University, Qazvin, Iran
2 - Department of Financial Management, Qazvin Branch, Islamic Azad University, Qazvin, Iran
3 - Department of Mathematics, Qazvin Branch, Islamic Azad University, Qazvin, Iran.
Keywords: Risk-taking, Financial Literacy, Emotional Intelligence, Self-confidence, Behavioral Finance,
Abstract :
The purpose of this study is to explain the factors affecting investors' risk taking, including self-confidence, financial literacy, and emotional intelligence in the investment process. This research is considered a correlation analysis from the perspective of the objective and is quantitative and applied in terms of the research process. The statistical population under study includes investors active in the Tehran Stock Exchange. Standard questionnaires were used to measure the desired variables, and the data collected from 280 questionnaires were analyzed using structural equations and Smart PLS4 software. The results of the hypothesis test indicate a positive and significant effect of emotional intelligence, financial literacy, and self-confidence on investors' risk taking and significantly predict about 63.5 percent of the risk taking variable behavior. Accordingly, it is suggested that investors, by improving their financial knowledge and gaining a deeper understanding of the impact of emotional intelligence and self-confidence on their investment decisions, manage the relevant risks and thus improve the returns on their investments.
1) اشعری, الهام , خدابخش, روشنک و خمامی, ساناز . (1401). بررسی تأثیر ویژگی‌های شخصیتی و هوش هیجانی بر ریسک‌پذیری سرمایه‌گذاران. مطالعات حسابداری و حسابرسی، 11(43), 105-120.
2) حبیبی، آرش؛ کلاهی، بهاره (1401). مدل‌یابی معادلات ساختاری و تحلیل عاملی. تهران: جهاد دانشگاهی، چاپ دوم.
3) خدری,شایسته,هوشمندی,حمید.(1403).نقش میانجی ریسک‌پذیری در رابطه ساختاری هوش هیجانی و هوش مالی با تمایل به سرمایه‌گذاری.مهندسی مالی و مدیریت اوراق بهادار,61(15),186-206.
4) روشنگرزاده,امین,دستگیر,محسن,ساعدی,رحمان.(1402).تأثیر سواد مالی بر سوگیری های رفتاری فرا اعتمادی و رفتار جمعی و تحلیل اثر آنها بر عملکرد سرمایه گذاران در بورس اوراق بهادار تهران با استفاده از مدلسازی معادلات ساختاری.تحلیل بازار سرمایه,2(3),1-30.
5) شنائی، سیدنجیب اله، ذبیحی، شورورزی (1402). طراحی الگوی ظرفیت ریسک‌پذیری سرمایه‌گذاران حقیقی با رویکرد داده بنیاد. توسعه و سرمایه:8 (2) 247-269.
6) عین آبادی, جواد, خوش فطرت, نیلوفر, باباخانی قاضی جهانی, علی. (1401). بررسی ریسک پذیری سرمایه گذاران بازارهای مالی و ارتباط آن با سواد مالی. چشم انداز حسابداری و مدیریت, 5(72), 86-95.
7) قاسمی, اسماعیل , صراف, فاطمه , حمیدیان, محسن و دارابی, رویا . (1401). تاثیر هوش هیجانی بر عملکرد صندوق های سرمایه‌گذاری در ایران با تاکید بر حسابداری ذهنی. دانش سرمایه‌گذاری, 11(42), 481-505.
8) لاری دشت بیاض, محمود , محمدی, شعبان و معین نژاد, بهراد . (1396). تاثیر هوش هیجانی بر عملکرد سبد سهام سرمایه گذار. پژوهش های حسابداری و حسابرسی عملیاتی و عملکرد, 1(3), 99-119.
9) موسوی شیری, سید محمود , بخشیان, عسل , براتی, هدی . (1394). تاثیر هوش هیجانی بر کیفیت تصمیمگیری سرمایه گذاران در بورس اوراق بهادار تهران. دانش سرمایه‌گذاری, 5(17), 99-112.
10) مهدیزاده,بی بی ملیحه ,خداداد حسینی,سید حمید,نظرپور کاشانی,حامد.(1403).بررسی تحلیلی تولیدات علمی سواد و دانش مالی و رهیافت های بهبود تجربه مشتری در بستر بازار سرمایه با رویکرد علم سنجی.مهندسی مالی و مدیریت اوراق بهادار,60(15),189-208.
11) میرزازاده, زهرا, یزدانی, شهره, خان محمدی, محمد حامد, محمودیان دستنائی, طاهره. (1402). بررسی نقش میانجیگری عوامل موثر بر رفتار( ریسک پذیری، اعتماد به نفس و تفکر استراتژیک) در رابطه بین هوش هیجانی و کیفیت قضاوت و تصمیم گیری سرمایه گذاران. دانش سرمایه‌گذاری, 12(48), 637-670.
12) ناطق گلستان، احمد، و زینبی، ناصر. (1400). تاثیر ویژگی های شخصیتی بر ادراک ریسک سرمایه گذاران بورس اوراق بهادار؛ تحلیل نقش میانجی تمایل به ریسک. پیشرفت های مالی و سرمایه گذاری، 2(4 )، 33-54.
13) Ahmad, F. (2020). Personality traits as predictor of cognitive biases: moderating role of risk attitude. Qualitative Research in Financial Markets, 12(4), 465–484. https://doi.org/10.1108/QRFM-10-2019-0123
14) Anderson, A., Baker, F., & Robinson, D. T. (2017). Precautionary savings, retirement planning and misperceptions of financial literacy. Journal of financial economics, 126(2), 383-398.
15) Aren, A., &Hamamci, H.N. (2022). Evaluation of investment preference with phantasy, emotional intelligence, confidence, trust, financial literacy and risk preference. https://doi.org/10.1108/K-01-2022-0014
16) Aren, S., & Canikli, S. (2018, July). The effect of financial literacy and risk perception on investment choices of individual investors. In 8th International Conference on Leadership, Technology, Innovation and Business Management, July (pp. 12-14).
17) Atlas, S. A., Lu, J., Micu, P. D., & Porto, N. (2019). Financial knowledge, confidence, credit use, and financial satisfaction. Journal of Financial Counseling and Planning, 30(2), 175-190. http://dx.doi.org/10.1891/1052- 3073.30.2.175
18) Babli, D. and Saloni, R. (2020). “Do Personality Traits and Emotional Intelligence of Investors Determine Their Risk Tolerance?” Management and Labour Studies. 43 (1), 88-9
19) Bakar, S., & Yi, A. N. C. (2016). The impact of psychological factors on investors’ decision making in Malaysian stock market: a case of Klang Valley and Pahang. Procedia Economics and Finance, 35, 319-328.
20) Bandura, A., & Wessels, S. (1997). Self-efficacy (pp. 4-6). Cambridge: Cambridge University Press.
21) Bar-On, R. E., & Parker, J. D. (2000). The handbook of emotional intelligence: Theory, development, assessment, and application at home, school, and in the workplace. Jossey-Bass/Wiley.
22) Bellofatto A, D’Hondt C, De W R. (2018). Subjective financial literacy and retail investors’ behavior. Journal of Banking and Finance. 92 (2018). 168–181.
23) Bortoli, D. Costa, N. Goulart, M. and Campara, J. (2019). “Personality traits and investor profile analysis”. A behavioral finance study. 14(3): 1 – 18.
24) Bouteska, A., & Regaieg, B. (2020). Loss aversion, overconfidence of investors and their impact on market performance evidence from the US stock markets. Journal of Economics, Finance and Administrative Science, 25(50), 451-478.
25) Brown, K. W., & Ryan, R. M. (2003). The benefits of being present: mindfulness and its role in psychological well-being. Journal of personality and social psychology, 84(4), 822.
26) Chen, Chaoran et al. 2022. “Mediating Role of Optimism Bias and Risk Perception between Emotional Intelligence and Decision-Making: A Serial Mediation Model.” Frontiers in Psychology 13(June): 1–9.
27) Cherniss, C., Extein, M., Goleman, D., & Weissberg, R. P. (2006). Emotional intelligence: what does the research really indicate? Educational psychologist, 41(4), 239-245.
28) Dhiman, B., & Raheja, S. (2018). Do personality traits and emotional intelligence of investors determine their risk tolerance? Management and Labour Studies, 43(1-2), 88-99.
29) Diacon, S.R. & C. Ennew. (2001), "Consumer perceptions of financial risk", Geneva Papers on Risk and Insurance: Issues and Practice, 2001, Vol. 26 No. 3.
30) Dinç Aydemir, S., & Aren, S. (2017). Do the effects of individual factors on financial risk-taking behavior diversify with financial literacy? Kybernetes, 46(10), 1706-1734.
31) Dweck, C., & Yeager, D. (2020). A growth mindset about intelligence. Handbook of wise interventions: How social psychology can help people change, 9-35.
32) Feng X, Lu B, Song X, Ma S. (2019). Financial literacy and household finances: A Bayesian two-part latent variable modeling approach. Journal of Empirical Finance. 51(2019). 119-137
33) Goleman, D. (2005). Daniel Goleman on emotional intelligence. The George Luca Educational Foundation.
34) Grohmann A, Kluhs T, Menkhoff L. (2018). Does financial literacy improve financial inclusion? Cross country evidence. World Development. 111 (2018). 84– 96
35) Grohmann, A. (2018). » Financial literacy and financial behavior: Evidence from the emerging Asian middle class«. Pacific-Basin Finance Journal. 48(2018). 129- 143.
36) Hair Jr, J. F., Hult, G. T. M., Ringle, C. M., Sarstedt, M., Danks, N. P., & Ray, S. (2021). Partial least squares structural equation modeling (PLS-SEM) using R: A workbook (p. 197). Springer Nature.
37) Hair, J. F., Hult, G. T. M., Ringle, C. M., and Sarstedt, M. (2017). A Primer on Partial Least Squares Structural Equation Modeling (PLS-SEM), 2nd Edition, Sage Publications Inc., Thousand Oaks, CA.
38) Henseler, J., Dijkstra, T. K., Sarstedt, M., Ringle, C. M., Diamantopoulos, A., Straub, D. W & Calantone, R. J. (2014). Common beliefs and reality about partial least squares. Organizational Research Methods, 17(2), 182-209.
39) Henseler, J., Ringle, C. M., & Sinkovics, R. R. (2009). The use of partial least squares path modeling in international marketing. In New challenges to international marketing. Emerald Group Publishing Limited.
40) Hogarth, J., & Hilgert, M. A. (2002). Financial literacy and family and consumer sciences. Journal of Family and Consumer Sciences: From Research to Practice, 94(1), 15–28.
41) Keller, j. (2018). Self-confidence, gender, knowledge and experience impact on the investment effectiveness on capital market. Entrepreneurship and Ma, v. XVIII, NO.1.
42) Lusardi, A., & Mitchell, O. S. (2017). How ordinary consumers make complex economic decisions: Financial literacy and retirement readiness. Quarterly Journal of Finance, 7(03), 1750008.
43) Manafe, J. D. (2021). The Effect of Financial Knowledge, Financial Experience and Spiritual Intelligence on Investment Planning Behavior. Jurnal Ekonomi dan Bisnis Jagaditha, 8(2), 209-214. Doi: https://doi.org/10.22225/jj.8.2.2021.209-214
44) Miller, M., Godfrey, N., Levesque, B., & Stark, E. (2009). The Case for Financial Literacy in Developing Countries. World Bank Group.
45) Mounaa A, Anis J. (2017). Financial literacy in Tunisia: Its determinants and its implications on investment behavior. Research in International Business and Finance. 39 (2017). 568–577.
46) Sahi, S.K. and Kalra, S.K., 2013. Measuring financial risk taking using a dual preference approach for determination of financial satisfaction.
47) Sashikala, V. &. Chitramani, P. (2017). A Review on Emotional Intelligence and Investment Behavior.International Journal of Management, 8 (3), 32–41.
48) Shimizutani, S., & Yamada, H. (2020). Financial literacy of middle-aged and older Individuals: Comparison of Japan and the United States. The Journal of the Economics of Ageing, 16, 100214.
49) Stango, V., & Zinman, J. (2009). Exponential growth bias and household finance. The Journal of Finance, 64(6), 2807-2849. https://doi.org/10.1111/j.1540-6261.2009.01518.x
50) Tang, Ning & Baker, Andrew. (2016). Self-esteem, financial knowledge and financial behavior. Journal of Economic Psychology. 54(2016). 164-176.
51) Tauni, M. Z., Fang, H. X., & Iqbal, A. (2017). The role of financial advice and word-of-mouth communication on the association between investor personality and stock trading behavior: Evidence from Chinese stock market. Personality and Individual Differences, 108, 55-65.
52) Upadhyay, D., Talwar, S., Tiwari, S., & Gujral, H. (2020). Self-confidence a demeanor to emotional intelligence. Proteus Journal, 11(11), 120-134.
53) VanderPal, G. (2021). Emotional quotient and intelligence quotient on behavioral finance and investment performance. VanderPal, GA (2021). Emotional Quotient and Intelligence Quotient on Behavioral Finance and Investment Performance. Journal of Marketing Development and Competitiveness, 15(2).
54) Wang, C. Zheying, Y. Abed, G. (2019). “Does personality predict financial risk tolerance of pre-retiree baby boomers?” Journal of Behavioral and Experimental Finance. 23 (1): 67- 98
55) Xu, H. Zhan, H. Fannin, L. (2017). The impact of market economy on individuals' financial behaviors. International Journal of Research in Business. 22(19). 1933 - 6021.
56) Yanti, F., & Endri, E. (2024). Financial behavior, overconfidence, risk perception and investment decisions: The mediating role of financial literacy. International Journal of Economics and Financial Issues, 14(5), 289-298.