Role of Psychological and Social Factors on Investment Decision of Individual Investors in Islamabad Stock Market

Sci.Int.(Lahore),27(5),4697-4706,2015

10 Pages Posted: 23 Aug 2018

See all articles by Abdul Moueed

Abdul Moueed

National College of Business Administration and Economics (NCBA&E)

Ahmed Imran Hunjra

International University of Rabat - Rabat Business School; Ghazi University, Dera Ghazi Khan ; Pir Mehr Ali Shah Arid Agriculture University Rawalpindi (PMAS); University of Waikato

Muhammad Umar Asghar

Pir Mehr Ali Shah Arid Agriculture University Rawalpindi (PMAS)

Basharat Raza

National College of Business Administration and Economics (NCBA&E)

Date Written: 2015

Abstract

Investment decision making is a complicated process of choosing a best available option from a number of alternative options. It is an activity that is fulfilled after a keen evaluation of all the other alternatives. The current study investigates the psychological and social factors, impact the investment decision making of the individual investors and how the Psychological and social factor jointly are related to investment decisions. Using the descriptive statistical techniques on the data which was collected from 250 individual investors choose randomly trading at Islamabad stock exchange through a structured questionnaire. The findings of the study indicate that the psychological and social factors have a certain impact on the decision making process of the individual investors trading in the stock market while making investment decisions and investors are more aware about the situations and factors that may influence their decision making ability. There are some factors which affect males more than females like anger, fear, herding and stress. On the other hand, mood and social interaction affect female investor's decision making more than male investors. Furthermore, experienced investors face other biases such as anger.

Keywords: Behavioral Finance, Investment Decision Making, Individual Investors, Psychological Factors, Social Factors, Stock Market

Suggested Citation

Moueed, Abdul and Hunjra, Ahmed Imran and Asghar, Muhammad Umar and Raza, Basharat, Role of Psychological and Social Factors on Investment Decision of Individual Investors in Islamabad Stock Market (2015). Sci.Int.(Lahore),27(5),4697-4706,2015, Available at SSRN: https://ssrn.com/abstract=3229724

Abdul Moueed

National College of Business Administration and Economics (NCBA&E) ( email )

40/E-1, Gulberg-III
National College of Business Administration & Econ
Lahore, Punjab 54660
Pakistan

Ahmed Imran Hunjra (Contact Author)

International University of Rabat - Rabat Business School ( email )

Technopolis Rabat-Shore Rocade Rabat-Salé
Rabat, 11103
Morocco

Ghazi University, Dera Ghazi Khan ( email )

Airport road D G Khan
Dera Ghazi Khan
Pakistan

Pir Mehr Ali Shah Arid Agriculture University Rawalpindi (PMAS) ( email )

Muree Road Rawalpindi
Shamsabad, Punjab 44000
Pakistan
00923457162527 (Phone)

University of Waikato ( email )

Te Raupapa
Private Bag 3105
Hamilton, Waikato 3240
New Zealand

Muhammad Umar Asghar

Pir Mehr Ali Shah Arid Agriculture University Rawalpindi (PMAS)

Muree Road Rawalpindi
Rawalpindi, Punjab 44000
Pakistan

Basharat Raza

National College of Business Administration and Economics (NCBA&E)

40/E-1, Gulberg-III
National College of Business Administration & Econ
Lahore, Punjab 54660
Pakistan

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