A comparative survey on behavioral factors on financial assets investment

Subject Areas : Journal of Investment Knowledge

Hamidreza Kordlouie ¹ (Assistant professor and member of Scientific Board- Islamic Azad University Eslamshahr Branch)
Nader Dashti ² (Assistant professor and member of Scientific Board-Petroleum University of Technology-Petroleum University of Tehran)
Razieh Seifollahi ³ (MA in Financial Management, Islamic Azad University Central Tehran Branch)

Received: 2015-02-03 Accepted : 2015-04-29 Published : 2015-04-29

Keywords: Behavioral Finance, Regret aversion, disposition effect, mental accounting, over confidence, Representativeness, herding behavior, Conservatism, Endowment effect,

Abstract :

Since 1980s by appearing behavioral finance literature, logically investment hypothesis and also efficient market ruined. The mentioned literature states that some biases cause on decision making while trading shares. This study investigates the effect of some behavioral elements on security investment. The aforesaid elements are Regret aversion, Disposition effect, Mental accounting, over confidence, Representativeness, Herding behavior, Conservatism and Endowment effect. In order to do the study, a sample of 385 investors in stock market was chosen and data was gathered through a questionnaire. Statistical tests examined the research hypotheses. Results show that all factors have a significant effect on investors'' decision-making exclude over-confidence. Due to different affection, the elements were rated. Rating indicates that the sequence of them is as follow:  1-Mental accounting, 2-Disposition effect, 3- Conservatism, 4- Herding behavior, 5- Representativeness, 6-Endowment effect, 7- Regret aversion.