Impact of Psychological Factors on Investment Decisions – Moderating Role of Personality Traits

Abstract

The study aims to examine the moderating influence of the Big Five personality traits on the association between psychological factors and investing decision. The present study employs a single method of quantitative analysis. A sample size of 100 respondents was determined using the Kregcie-Morgan table, with a margin of error of 7.5%. In order to compensate for participants who did not respond, 200 questionnaires were handed out, and 145 of these responses were considered appropriate for the study. A meticulously designed questionnaire was created by using insights from prior research on Psychological variables, Personality traits, and investment decisions. The questions were meticulously formulated to guarantee lucidity and prevent prejudice, enabling participants to offer precise and significant responses. The questionnaire's validity and reliability were assessed using the Gaskins master validity table. The data was analyzed using factor analysis in SPSS and confirmatory factor analysis in AMOS software. The moderation analysis was performed utilizing the Andrew Hayes process macros. The results of the study show that Neuroticism diminishes the beneficial relationship between Psychological Factor and Investment decision. The positive association between Psychological Factor and Investment decision is strengthened by a high degree of openness to experience. Agreeableness reduces the positive relationship between Psychological Factor and Investment decision.