Collective mental accounting: an integrated behavioural portfolio selection model for multiple mental accounts

Momen, Omid; Esfahanipour, Akbar; Seifi, Abbas

doi:10.1080/14697688.2018.1489138

Cited by 11 publications

(3 citation statements)

References 21 publications

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“…Furthermore, prior literatures reviewed shows that, the majority of the studies focused largely on the developed world with few studies from the developing countries. For instance, the study of Alrabadi et al (2018) in Jordan, Polat and Polat (2019) in Turkey, Momen et al (2016) in Iran, Road et al, (2013) in Iran, Rockenbach, (2004) in Germany, Angelina and Batam (2020) in Indonesia, Babikir (2017) in Saudi Arabian, Cao et al (2021) in Vietnam, Sabir, Mohammad and Shahar (2019)in Pakistan, Tin and Hii, (2020) in Malaysia. Existing empirical studies show that people's behavior differ from continent to continent, with few studies on western countries.…”

Section: Introductionmentioning

confidence: 99%

Herding Bias and Financial Risk Tolerance On Individual Investment Performance in Nigeria: Moderated by Financial Literacy

Apochi,

Ahmed,

Okpanachi

et al. 2024

IJBMR

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Prior studies have shown that various individuals’ behavioral traits such as herding bias and risk tolerance have an unfavorable effect on investors' decision-making. This paper examined the moderating role of financial literacy on herding bias and financial risk tolerance on individual investment performance in Nigeria. The population consisted of 460 active individual investors in Kaduna city as at the first quarter of 2023. A total of 460 copies of questionnaires were distributed, with 349 valid. A census method of sampling was used, and primary data was collected using a self-administered questionnaire and an online Google form. A 7-point Likert scale that ranged from '1' "Extremely Agree" to '7' "Extremely Disagree" was used. Smart-PLS version 4 was used to analyze the data. The study discovered that the herding bias has a positive and significant effect on investment performance, whereas financial risk tolerance has an insignificant negative effect on investment performance. Financial literacy has a positive but insignificant impact on investment performance. Furthermore, the moderating effect of financial literacy demonstrated that the herding bias has a significant and positive impact on investment performance. Risk tolerance has a significant negative influence on investment performance. This study concluded that herding bias helps investors make better investment decisions, Consequently, the study recommends that investors should reduce their risk tolerance levels while maintaining the herding behavioral bias.

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Section: Introductionmentioning

confidence: 99%

Herding Bias and Financial Risk Tolerance On Individual Investment Performance in Nigeria: Moderated by Financial Literacy

Apochi,

Ahmed,

Okpanachi

et al. 2024

IJBMR

View full text Add to dashboard Cite

show abstract

“…However, the majority of these studies focused largely on the developed world with not so many researches in developing countries like Nigeria. For instance, the study of Alrabadi et al (2018) in Jordan, Nayak and Kumar, (2021) in India, Mahapatra and Mishra (2020) in Indian, Polat and Polat (2019) in Turkey, Mohammad et al, (2021) in Saudi Arabia, Momen et al (2016) in Iran, Road et al, (2013) in Iran, Rockenbach, (2004) in Germany, Angelina and Batam (2020) in Indonesia, Babikir (2017) in Saudi Arabian, Cao et al (2021) in Vietnam, Sabir, Mohammad and Shahar (2019)in Pakistan, Tin and Hii, (2020) in Malaysia. These existing empirical studies documented that individuals' behavior varies from continent to continent with few studies on western countries.…”

Section: Introductionmentioning

confidence: 99%

Effect of Prospect Factor and Herding Effect on Individual Investment Performance in Nigeria: Moderating Role of Financial Literacy

Apochi¹,

Mohammed²,

Okpanachi³

et al. 2023

EJAAFR

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Investors exhibit irrational behavior when making an investment decision. The decision-making process itself is considered to be a cognitive process, as the investors have to make a decision based on various alternatives available to them. Prior studies had shown that the investors’ decision-making was adversely affected by the various behavioral factors. This study was carried forward to identify the moderating role of financial literacy (FL) on the effect of prospect factor (PF) and herding effect (HE) on investment performance. The population of study was 3,706 and the sample size was the active investors resident in Kaduna metropolitan within the first quarter of 2023. Thus, 460 structured questionnaires were administered and 349 were returned valid. A convenient sampling technique was adopted in this study, and a primary data was collected from the respondents using both the online Google form and self-administered questionnaire with the help of research assistants. A 7-point Likert-type scale ranging from ‘1’ “Extremely Agree” to ‘7’ “Extremely Disagree” was employed. Smart-PLS 4 and SPSS 20 version was used to analyses the data and explained the demographic characteristics of the individual respectively. Findings from this study revealed that prospect factor and financial literacy have positive and significant influence on individual investment performance, while the herding effect is found to have a negative and insignificant influence on individual investment performance. Furthermore, the moderating role of financial literacy revealed that prospect factor and herding effect have an insignificant negative effect on individual investment performance. The study recommends that individual investors should have high levels of financial literacy. It has been empirically proven that FL help investors make better investment decision, in addition to satisfaction in their investment performance. Also, the investors should maintain the use of prospect behavioral biases when making investment decision as it has improved investment performance.

show abstract

Section: Introductionmentioning

confidence: 99%

Untitled

2023

EJAAFR

View full text Add to dashboard Cite

Investors exhibit irrational behavior when making an investment decision. The decision-making process itself is considered to be a cognitive process, as the investors have to make a decision based on various alternatives available to them. Prior studies had shown that the investors' decision-making was adversely affected by the various behavioral factors. This study was carried forward to identify the moderating role of financial literacy (FL) on the effect of prospect factor (PF) and herding effect (HE) on investment performance. The population of study was 3,706 and the sample size was the active investors resident in Kaduna metropolitan within the first quarter of 2023. Thus, 460 structured questionnaires were administered and 349 were returned valid. A convenient sampling technique was adopted in this study, and a primary data was collected from the respondents using both the online Google form and self-administered questionnaire with the help of research assistants. A 7-point Likert-type scale ranging from '1' "Extremely Agree" to '7' "Extremely Disagree" was employed. Smart-PLS 4 and SPSS 20 version was used to analyses the data and explained the demographic characteristics of the individual respectively. Findings from this study revealed that prospect factor and financial literacy have positive and significant influence on individual investment performance, while the herding effect is found to have a negative and insignificant influence on individual investment performance. Furthermore, the moderating role of financial literacy revealed that prospect factor and herding effect have an insignificant negative effect on individual investment performance. The study recommends that individual investors should have high levels of financial literacy. It has been empirically proven that FL help investors make better investment decision, in addition to satisfaction in their investment performance. Also, the investors should maintain the use of prospect behavioral biases when making investment decision as it has improved investment performance.

show abstract

Collective mental accounting: an integrated behavioural portfolio selection model for multiple mental accounts

Cited by 11 publications

References 21 publications

Herding Bias and Financial Risk Tolerance On Individual Investment Performance in Nigeria: Moderated by Financial Literacy

Herding Bias and Financial Risk Tolerance On Individual Investment Performance in Nigeria: Moderated by Financial Literacy

Effect of Prospect Factor and Herding Effect on Individual Investment Performance in Nigeria: Moderating Role of Financial Literacy

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