The Cognitive and Psychological Bias in Investment Decision-Making Behavior:  (Evidence From Indonesian Investor’s Behavior)

Ady, Sri Utami

doi:10.22610/jebs.v10i1.2092

Cited by 13 publications

(10 citation statements)

References 5 publications

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“…Availability does not significantly affect Investment decisions. The results of this study are consistent with the results of Jain et al (2020) and Ady (2018). Availability does not affect the investment decisions of the people of Batam City.…”

Section: Resultssupporting

confidence: 90%

Why do investors choose a mutual fund?

Cuandra

Rinaldo

2021

JIKO

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The purpose of this research is to identify the factors that support mutual funds investment decisions through overconfidence, risk perception, loss aversion, availability, and herding variables on the investment decisions of the residents of Batam City. Data were collected through questionnaires and processed using multiple linear regression. The results of testing and processing research data show that overconfidence, loss aversion, and herding significantly positively affect investment decisions, while risk perception and availability do not affect investment decisions.

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Section: Resultssupporting

confidence: 90%

Why do investors choose a mutual fund?

Cuandra

Rinaldo

2021

JIKO

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“…In this circumstance, herding might assist with professional performance evaluation since low-ability individuals may copy the conduct of their high-ability peers to improve their professional reputation. Ady (2018) finds cognitive bias and psychological bias behavior occur in nearly all informants; psychology bias can be divided into two types: expected emotion bias behavior and immediate emotion bias behavior; experience, capital market knowledge, and the management of positive emotions determine the level of psychological stability and reduce bias behavior, which could increase return. Emotional instability leads to irrational behavior among investors, resulting in sub-optimal returns and even inefficient portfolio selection, leading to sub-optimal returns and even losses (Ady et al, 2013).…”

Section: Theoretical Reviewmentioning

confidence: 99%

Effect of Cognitive Biases on Investment Decision Making: A Case of Pokhara Valley, Nepal

Dhungana

Bhandari²,

Ojha

et al. 2022

QJMSS

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Background: Behavioral finance deals with the study of psychological influences on investors and financial markets. Investors commonly perform investment analysis through fundamental and technical analysis. The behavior of the investment market originates from the principles of psychological decision-making that explains the reasons behind buying and selling stocks. Objectives: This paper aims to examine the effect of cognitive biases on investment decisions in Pokhara Valley, Nepal. The effect of five cognitive biases, such as availability, anchoring, overconfidence, herd instinct, and regret aversion, is measured on rational investment decision-making. Methods: This study is based on primary data sources using non-probability (convenience method) sampling techniques. There are seven brokerage houses in Pokhara valley, and researchers selected 179 respondents involved in stock market investment. Both descriptive and inferential analyses were made to analyze the data. Results: The study discovers a link between irrationality in financial decision-making and availability, overconfidence, and herd instinct biases, but anchoring and regret aversion biases had no effect on irrational investment decisions. However, though all the biases have a positive relationship with an irrational investment decision, overconfidence bias has the highest impact. Regret aversion bias has the least impact on investment decisions in comparison to the other four biases. Conclusion: The investors and the policymakers should focus on finding the cognitive biases and various de-biasing methods to eradicate those biases throughout investment decision-making. The findings of this study have a number of implications for investors, brokers, and governments who aim to stimulate stock market investment.

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“…For Customers Enforcement for customers that E-money is a non-cash payment product that is classified as new so that the socialization conducted by Bank Indonesia in collaboration with the issuer of E-money is essential to introduce and develop the potential of E-money which serves as a substitute for currency for small transactions. The need for decisions that logically benefit customers, needs to be realized by the customer, because in general the customers in making decisions are often influenced by psychology (Ady, 2018), perhaps out of fear of high-tech products, suspicion of fraud from others, fear of difficulties use and so before trying, so it takes courage to try new things. c. For further researchers It is expected to be able to conduct more in-depth and broader research on E-Money policies as a new payment system tool using different research methods.…”

Section: Research Recommendations and Limitationsmentioning

confidence: 99%

E-Money As A Payment System Tool In Flazz Bca Card Users In Surabaya

Rizqi

Ady

2019

Ekspektra J. Bisnis dan Manaj.

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The purpose of this research is to understand and analyze to find out the e-money wisdom in Indonesia as a new payment system tool for users of BCA Flazz cards. This research uses Purposive Sampling techniques, namely the method of determining the sample with specific considerations ". Considerations in determining the example in this study are BCA Customer Service Bank and users who use the BCA Flazz Card. The process of collecting data in this study carried out by interview. The author selects the data obtained during the survey of E-Money Policy as a new payment system tool; then the data is categorized according to the details of the problem. The information is connected so that conclusions drown quickly in response to the focus of the existing research. The research observation method is carried out by recording when the event occurred or specific symptoms according to the discussion under study. Observation activities of researchers do provide and convey a realistic picture of data presentation. The results of this study indicate that regarding the management of the handling of Flazz BCA products, it immediately ignored by Customer Service. The FLAZZ BCA card is very profitable because it is practical and efficient, but the use of FLAZZ BCA itself still cannot cover the entire country, there are several regions and some traders who still use conventional sales transactions. It is better to have socialization activities for E-money users an explanation of features that make it easier for users to use E-money facilities, and need to be rearranged about terms and regulations that e-money owners must comply with so that E-money publishers are more careful - careful and selective in giving permission to use facilities to E-money users. E-Money Sebagai Alat Sistem Pembayaran Pada Pengguna Kartu Flazz Bca Di SurabayaAbstrakPenelitian ini bertujuan untuk mengetahui kebijakan e-money di Indonesia sebagai alat sistem pembayaran yang baru pada pengguna kartu flazz BCA.Penelitian ini menggunakan teknik Purposive Sampling yaitu teknik penentuan sampel dengan pertimbangan tertentu”. Pertimbangan dalam penentuan sampel pada penelitian ini adalah Customer Service Bank BCA dan pengguna yang menggunakan Kartu Flazz BCA. Proses pengumpulan data dalam penelitian ini, dilakukan dengan wawancara. Penulis melakukan pemilihan data yang diperoleh pada saat penelitian mengenai Kebijakan E-Money sebagai alat sistem pembayaran yang baru, kemudian data tersebut dikategorikan sesuai dengan rincian masalahnya. Data tersebut dihubungkan antara satu dengan yang lainnya sehingga mudah ditarik simpulan sebagai jawaban terhadap fokus penelitian yang ada. Metode observasi penelitian ini dilakukan dengan cara mencatat pada saat peristiwa terjadi atau gejala tertentu sesuai dengan pembahasan yang diteliti. Kegiatan observasi peneliti lakukan untuk memberikan dan menyampaikan gambaran penyajian data yang realistis. Hasil penelitian ini menunjukkan bahwa mengenai pengelolaan produk Flazz BCA penanganannya langsung di lakukan oleh Customer Service. Kartu FLAZZ BCA sangat menguntungkan karena praktis dan efiesien, Tetapi penggunaan FLAZZ BCA sendiri masih belum dapat mencakup seluruh negeri, ada beberapa daerah dan beberapa pedagang yang masih menggunakan transaksi penjualan secara konvensional. Sebaiknya perlu diadakan kegiatan sosialiasasi terhadap pengguna E-money penjelasan fitur-fitur yang memudahkan pengguna dalam menggunakan fasilitas E-money, dan perlu di atur kembali tentang syarat- syaratdan peraturan yang harus dipatuhi oleh pemilik e-money sehingga penerbit E-money lebih berhati- hati dan selektif dalam memberikan izin penggunaan fasilitas kepada pemilik E-money.

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The Cognitive and Psychological Bias in Investment Decision-Making Behavior: (Evidence From Indonesian Investor’s Behavior)

Cited by 13 publications

References 5 publications

Why do investors choose a mutual fund?

Why do investors choose a mutual fund?

Effect of Cognitive Biases on Investment Decision Making: A Case of Pokhara Valley, Nepal

E-Money As A Payment System Tool In Flazz Bca Card Users In Surabaya

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