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Behavioral Finance is an evolving field that studies how psychological factors affect decision making under uncertainty. Herding behavior is one of the psychological factors that instigate investor to mimic the actions of other investors in the market rather than using his personal assessments. This study seeks to find the influence of certain attitudinal factors namely, decision conformity, hasty decision, mood, decision accuracy and overconfidence, on the individual investor tendency to embrace herd behavior. Primary data for the study are collected using structured questionnaires from a sample of 194 investors who are trading at Islamabad and Lahore branches of Pakistan Stock Exchange. Multiple linear regression analysis is used to test the hypotheses of this study. Findings of this study provide evidence that attitudinal factors have significant influence on investor’s tendency to take on herd behavior. It is concluded from the results of multiple linear regression that decision conformity, mood and decision accuracy have significant impact on individual investor tendency to adopt herd behavior. However, investor hasty decision and overconfidence are insignificant predictors of herd behavior.

Faid Gul, Karamat Khan. (2019) An Empirical Study of Investor Attitudinal Factors Influencing Herd Behavior: Evidence from Pakistan Stock Exchange, Abasyn Journal of Social Sciences, Volume-12, Issue-1.
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