concept

Investor psychology

Also known as: Investor psychology, retail investor psychology, investor psychology

Facts (11)

Sources

The Influence of Behavioral Biases on Investment Decisions jmsr-online.com Journal of Management and Strategy Research Jul 8, 2025 5 facts

referenceThe conceptual model of retail investor psychology identifies five decision-making outcomes: asset allocation choices, risk tolerance, trading frequency, long-term versus short-term focus, and portfolio diversification.

referenceThe conceptual model of retail investor psychology identifies a feedback loop consisting of market gains or losses, emotional reactions (such as regret or confirmation bias), and the reinforcement of existing biases.

referenceThe conceptual model of retail investor psychology identifies five core behavioral biases: overconfidence, loss aversion, herd behavior, anchoring, and mental accounting.

claimInvestor psychology plays a pivotal role in financial decision-making, especially in retail contexts where informational asymmetry, cognitive overload, and social influence are pronounced.

referenceThe conceptual model of retail investor psychology identifies four categories of antecedents: financial literacy, demographic characteristics (age, gender, income, education), market conditions, and social media or peer influence.

Understanding Behavioral Aspects of Financial Planning and Investing financialplanningassociation.org Financial Planning Association Mar 1, 2015 2 facts

claimEffective financial planning and advising requires an understanding of investor psychology, as human emotions often override facts and figures in financial decision-making.

claimEffective financial planning and advising requires an understanding of investor psychology.

The influence of psychological factors on investment decision making exsys.iocspublisher.org JMAS Jan 18, 2024 2 facts

referenceNaseem, Mohsin, Hui, Liyan, and Penglai (2021) studied investor psychology and stock market behavior in China, Japan, and the United States during the initial era of the COVID-19 pandemic.

referenceJan, Jain, Li, Sattar, and Tongkachok published 'Post-COVID-19 investor psychology and individual investment decision: A moderating role of information availability' in Frontiers in Psychology in September 2022.

Influence of behavioral biases on investment decisions. The ... revistas.usc.gal Revistas USC 1 fact

referenceHirshleifer, D. (2001) published 'Investor Psychology and Asset Pricing' in The Journal of Finance, 56(4), 1533–1597.

The Impact of Cognitive Biases on Professionals' Decision-Making frontiersin.org Frontiers in Psychology 1 fact

referenceM. Statman, S. Thorley, and K. Vorkink published 'Investor overconfidence and trading volume' in the Review of Financial Studies in 2006, linking investor psychology to market activity.