Individual Investor Risk Tolerance from a Behavioural Finance Perspective in Gauteng, South Africa
The investment behaviour of individuals is unconsciously influenced by their thoughts, emotions, personal beliefs or past experiences to the degree that even individual investors with considerable knowledge may diverge from logic and reason. These influences, which can be classified as behavioural...
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| Format: | Article |
| Language: | English |
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EconJournals
2021-07-01
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| Series: | International Journal of Economics and Financial Issues |
| Online Access: | https://www.econjournals.com/index.php/ijefi/article/view/11451 |
| _version_ | 1828029535256313856 |
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| author | Anzel van den Bergh-Lindeque Sune Ferreira-Schenk Zandri Dickason-Koekemoer |
| author_facet | Anzel van den Bergh-Lindeque Sune Ferreira-Schenk Zandri Dickason-Koekemoer |
| author_sort | Anzel van den Bergh-Lindeque |
| collection | DOAJ |
| description |
The investment behaviour of individuals is unconsciously influenced by their thoughts, emotions, personal beliefs or past experiences to the degree that even individual investors with considerable knowledge may diverge from logic and reason. These influences, which can be classified as behavioural finance biases, may affect the manner in which risk is perceived and understood. This study aims to establish the relationship between the behavioural finance biases and the risk tolerance of individual investors within Gauteng, South Africa. This study also aims to identify the behavioural finance biases that drive individual investment decisions. Positive, statistically significant relationships were established between the behavioural finance biases and individual investor risk tolerance. Furthermore, the investment decisions of individual investors are driven to a rather great extent by the behavioural finance biases. The significance of these findings will contribute to facilitate the more practical and accurate profiling of individual investors' risk tolerance to ensure the successful implementation of investment strategies not only within South Africa, but also internationally.
Keywords: individual investors, risk tolerance, risk profiling, behavioural finance, investment decisions, Gauteng, South Africa
JEL Classifications: D81, G41
DOI: https://doi.org/10.32479/ijefi.11451
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| first_indexed | 2024-04-10T14:11:38Z |
| format | Article |
| id | doaj.art-fbaa1e05e73a4024b9675c35c5b74712 |
| institution | Directory Open Access Journal |
| issn | 2146-4138 |
| language | English |
| last_indexed | 2024-04-10T14:11:38Z |
| publishDate | 2021-07-01 |
| publisher | EconJournals |
| record_format | Article |
| series | International Journal of Economics and Financial Issues |
| spelling | doaj.art-fbaa1e05e73a4024b9675c35c5b747122023-02-15T16:09:42ZengEconJournalsInternational Journal of Economics and Financial Issues2146-41382021-07-01114Individual Investor Risk Tolerance from a Behavioural Finance Perspective in Gauteng, South AfricaAnzel van den Bergh-Lindeque0Sune Ferreira-Schenk1Zandri Dickason-Koekemoer2North West UniversityNorth West UniversityNorth West University The investment behaviour of individuals is unconsciously influenced by their thoughts, emotions, personal beliefs or past experiences to the degree that even individual investors with considerable knowledge may diverge from logic and reason. These influences, which can be classified as behavioural finance biases, may affect the manner in which risk is perceived and understood. This study aims to establish the relationship between the behavioural finance biases and the risk tolerance of individual investors within Gauteng, South Africa. This study also aims to identify the behavioural finance biases that drive individual investment decisions. Positive, statistically significant relationships were established between the behavioural finance biases and individual investor risk tolerance. Furthermore, the investment decisions of individual investors are driven to a rather great extent by the behavioural finance biases. The significance of these findings will contribute to facilitate the more practical and accurate profiling of individual investors' risk tolerance to ensure the successful implementation of investment strategies not only within South Africa, but also internationally. Keywords: individual investors, risk tolerance, risk profiling, behavioural finance, investment decisions, Gauteng, South Africa JEL Classifications: D81, G41 DOI: https://doi.org/10.32479/ijefi.11451 https://www.econjournals.com/index.php/ijefi/article/view/11451 |
| spellingShingle | Anzel van den Bergh-Lindeque Sune Ferreira-Schenk Zandri Dickason-Koekemoer Individual Investor Risk Tolerance from a Behavioural Finance Perspective in Gauteng, South Africa International Journal of Economics and Financial Issues |
| title | Individual Investor Risk Tolerance from a Behavioural Finance Perspective in Gauteng, South Africa |
| title_full | Individual Investor Risk Tolerance from a Behavioural Finance Perspective in Gauteng, South Africa |
| title_fullStr | Individual Investor Risk Tolerance from a Behavioural Finance Perspective in Gauteng, South Africa |
| title_full_unstemmed | Individual Investor Risk Tolerance from a Behavioural Finance Perspective in Gauteng, South Africa |
| title_short | Individual Investor Risk Tolerance from a Behavioural Finance Perspective in Gauteng, South Africa |
| title_sort | individual investor risk tolerance from a behavioural finance perspective in gauteng south africa |
| url | https://www.econjournals.com/index.php/ijefi/article/view/11451 |
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