Investment Literacy, Overconfidence and Cryptocurrency Investment

Forthcoming, Financial Services Review (accepted)

20 Pages Posted: 2 Nov 2021 Last revised: 28 Mar 2022

See all articles by Kyoung Tae Kim

Kyoung Tae Kim

University of Alabama

Sherman D. Hanna

Ohio State University (OSU)

Sunwoo T. Lee

York University

Date Written: March 2022


Cryptocurrency has been increasingly popular with investors in US financial market. Using the 2018 National Financial Capability Study Investor survey, this study examined the association between investment literacy and cryptocurrency investment. About 13% of investors invested in cryptocurrency directly or indirectly. Results from regression analyses show that objective investment literacy was negatively while subjective literacy was positively associated with holding cryptocurrency. Overconfident investors were more likely to invest in cryptocurrency, and results were robust across three overconfidence measures. This study has implications for investment advice, financial education and research.

Keywords: Investment literacy, financial knowledge, overconfidence, investment, cryptocurrency

JEL Classification: G5, G11, G53

Suggested Citation

Kim, Kyoung Tae and Hanna, Sherman D. and Lee, Sunwoo, Investment Literacy, Overconfidence and Cryptocurrency Investment (March 2022). Forthcoming, Financial Services Review (accepted), Available at SSRN: or

Kyoung Tae Kim (Contact Author)

University of Alabama ( email )

316-C Adams Hall
Tuscaloosa, AL 35487-0001
United States

Sherman D. Hanna

Ohio State University (OSU) ( email )

1787 Neil Avenue
Campbell 265D
Columbus, OH 43210
United States
614-292-4584 (Phone)

Sunwoo Lee

York University ( email )

4700 Keele Street
252 Atkinson Building
Toronto, Ontario M3J 1P3

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