Establishing a link between risk tolerance, investor personality and behavioural finance in South Africa
The main objective of this paper was to establish which behavioural finance biases are associated with a certain level of risk tolerance and investor personality. Furthermore, the study aimed to indicate how these behavioural finance biases can influence investment decisions. Since behavioural finan...
| Main Authors: | , |
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| Format: | Article |
| Language: | English |
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Taylor & Francis Group
2018-01-01
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| Series: | Cogent Economics & Finance |
| Subjects: | |
| Online Access: | http://dx.doi.org/10.1080/23322039.2018.1519898 |
| _version_ | 1823924736176947200 |
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| author | Zandri Dickason Sune Ferreira |
| author_facet | Zandri Dickason Sune Ferreira |
| author_sort | Zandri Dickason |
| collection | DOAJ |
| description | The main objective of this paper was to establish which behavioural finance biases are associated with a certain level of risk tolerance and investor personality. Furthermore, the study aimed to indicate how these behavioural finance biases can influence investment decisions. Since behavioural finance is becoming more essential in the investment industry, further research within a South African context was regarded as necessary. Results indicated that investors with a low-risk tolerance level and a conservative investor personality are subject towards loss aversion and mental accounting biases. Investors with a high-risk tolerance level are mostly subject towards the self-control bias. The significance of this study will enable investment companies to more accurately profile their investors and to offer more refined investment options. |
| first_indexed | 2024-12-16T19:57:48Z |
| format | Article |
| id | doaj.art-1ce1a259bdb04e96be570925de3ae008 |
| institution | Directory Open Access Journal |
| issn | 2332-2039 |
| language | English |
| last_indexed | 2024-12-16T19:57:48Z |
| publishDate | 2018-01-01 |
| publisher | Taylor & Francis Group |
| record_format | Article |
| series | Cogent Economics & Finance |
| spelling | doaj.art-1ce1a259bdb04e96be570925de3ae0082022-12-21T22:18:32ZengTaylor & Francis GroupCogent Economics & Finance2332-20392018-01-016110.1080/23322039.2018.15198981519898Establishing a link between risk tolerance, investor personality and behavioural finance in South AfricaZandri Dickason0Sune Ferreira1North West UniversityNorth West UniversityThe main objective of this paper was to establish which behavioural finance biases are associated with a certain level of risk tolerance and investor personality. Furthermore, the study aimed to indicate how these behavioural finance biases can influence investment decisions. Since behavioural finance is becoming more essential in the investment industry, further research within a South African context was regarded as necessary. Results indicated that investors with a low-risk tolerance level and a conservative investor personality are subject towards loss aversion and mental accounting biases. Investors with a high-risk tolerance level are mostly subject towards the self-control bias. The significance of this study will enable investment companies to more accurately profile their investors and to offer more refined investment options.http://dx.doi.org/10.1080/23322039.2018.1519898behavioural financeinvestorsinvestor personalitiesrisk toleranceinvestment decisions |
| spellingShingle | Zandri Dickason Sune Ferreira Establishing a link between risk tolerance, investor personality and behavioural finance in South Africa Cogent Economics & Finance behavioural finance investors investor personalities risk tolerance investment decisions |
| title | Establishing a link between risk tolerance, investor personality and behavioural finance in South Africa |
| title_full | Establishing a link between risk tolerance, investor personality and behavioural finance in South Africa |
| title_fullStr | Establishing a link between risk tolerance, investor personality and behavioural finance in South Africa |
| title_full_unstemmed | Establishing a link between risk tolerance, investor personality and behavioural finance in South Africa |
| title_short | Establishing a link between risk tolerance, investor personality and behavioural finance in South Africa |
| title_sort | establishing a link between risk tolerance investor personality and behavioural finance in south africa |
| topic | behavioural finance investors investor personalities risk tolerance investment decisions |
| url | http://dx.doi.org/10.1080/23322039.2018.1519898 |
| work_keys_str_mv | AT zandridickason establishingalinkbetweenrisktoleranceinvestorpersonalityandbehaviouralfinanceinsouthafrica AT suneferreira establishingalinkbetweenrisktoleranceinvestorpersonalityandbehaviouralfinanceinsouthafrica |