Does Personality Traits Influence the Choice of Investment?

Abstract

An investor’s investment in stock market is influenced by a large number of factors. Stock market’s performance is not only the result of intelligible characteristics or herd behavior, but is also due to the influence of psychological and personality characteristics that are still baffling the analysts. The study focuses on analyzing the influence of seven personality traits — emotional stability, extraversion, risk, return, agreeability, conscientiousness and reasoning — on the choice of the investment pattern. The results of the study show that these personality traits of the investors have an impact on the individuals while taking decisions and also have a strong influence on determining the method of investment. The study found that the influence of personality traits on the investment decision is more compared to that of demographic variables.