HERDING BEHAVIOR OF INDONESIA INVESTOR: ROLE OF PERSONALITY TRAITS AND MOTIVATION FACTORS

Candy Candy, Indra Novita

Abstract

This study aimed to determine the relationship between personality traits and motivation factors that causes herding behavior among individual investors in Indonesia. Personality traits included compliant, aggressive, and detached, while motivation factors used the cognitive ability, social factors, and emotional factors. This study's research method uses an online survey by distributing questionnaires to the stock investor in Indonesia. There were 460 questionnaires collected from the distribution of 1,534 sets of the questionnaire, and there were also 52 sets of the questionnaire are incompleted—the collected sets of data analyzed by using multiple regression. This study indicates that a compliant and aggressive personality has a significant positive effect on herding behavior. Meanwhile, a detached personality has a significant negative effect on herding behavior. Apart from that, the motivational factors that comprise cognitive ability, social factors, and emotional factors also significantly affected herding behavior.

Full Text:

PDF

References

Ali Shusha, A., & Abdelaziz Touny, M. (2016). The attitudinal determinants of adopting the herd behavior: an applied study on the Egyptian Exchange. Journal of Finance and Investment Analysis, 5(1), 55–69.

Arisanti, I., & Oktavendi, T. W. (2020). Herding behaviour in Sharia stock: the moderation effect of good governance business Sharia disclosure. Journal of Accounting and Investment, 21(1), 45–60. https://doi.org/10.18196/jai.2101136

Aydin, S., Ceylan, H. H., & Aydin, E. (2014). A research on reference behavior trend according to Horney’s personality types. Procedia - Social and Behavioral Sciences, 148, 680–685. https://doi.org/10.1016/j.sbspro.2014.07.014

Geetha, S. N. (2019). Herd behavior of investments: an assessment of Indian stock market. Indian Journal of Research, 8(7), 186–188.

Kawshala, B. A. H., Anuradha, P. A. N. S., & Shamil, M. M. (2020). Socio-economic, trading sophistication and self-reflection on investors; herding bias: evidence from Colombo Stock Exchange. International Journal of Management, Innovation & Entrepreneurial Research, 6(2), 128–138.

Kumari, S., Chandra, B., & Pattanayak, J. K. (2019). Personality traits and motivation of individual investors towards herding behaviour in Indian stock market. Kybernetes, 49(2), 384–405. https://doi.org/10.1108/K-11-2018-0635

Litimi, H. (2017). Herd behavior in the French stock market. Review of Accounting and Finance, 16(4), 497–515. https://doi.org/10.1108/RAF-11-2016-0188

Nair, M. A., Balasubramanian, & Yermal, L. (2017). Factors influencing herding behavior among Indian stock investors. International Conference on Data Management, Analytics and Innovation, ICDMAI 2017, 326–329. https://doi.org/10.1109/ICDMAI.2017.8073535

Sugiarto, E. C. (2019). Investasi dan Indonesia Maju. Kementerian Sekretariat Negara Republik Indonesia. https://setneg.go.id/baca/index/investasi_dan_indonesia_maju

Yao, J., & Tangjitprom, N. (2019). Herding behaviors in ASEAN stock markets. Journal of Economics and Management Strategy, 6(1), 1–16. https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3456583

Refbacks

  • There are currently no refbacks.