Recommendations

The following results are obtained based on statistical analysis and hypotheses testing:

  1. The attitudes of participants were toward the moderately relative importance of behavioral finance factors. (Overconfidence) was the most relatively important factor, followed by (Loss aversion), then (Risk Perception), while (Herding) was last. Moreover all factors were moderately of relative importance.
  2. There was a significant impact of behavioral finance factors on stock investment decision, when study the impact of factors together.
  3. There was a significant impact of overconfidence on stock investment decision in ASE. This indicates that overconfident investors are more capable to take stock investment decisions.
  4. There was a significant impact of loss aversion on stock investment decision. This means that loss aversion investors can avoid loss by keeping far from investment with high loss probability. This result does not contradict with the previous result of first sub-hypothesis, since investor behavioral finance varies from investor to another, and ensure that both (overconfidence and loss aversion) affect stock investment decision, but as isolated factors.
  5. The findings also showed that there was significant impact of herding on stock investment decision. This refers those investors in ASE impacted by other investors’ investment decisions.