Impact of Fınancıal Knowledge and Investor’s Personalıty Traıts on Investment Intentıon: Role of Attıtude and Fınancıal Self Effıcacy

Abstract

In recent years, there has been an upsurge in stock market investment intentions. Researchers are therefore becoming more and more eager to look into the factors that influence investors in general, and individual investors in particular to engage in stock market activities. Under the assumption of the theory of planned behavior this study looked at investor's intentions to invest in the stock market. The study primarily focusses on the impact of financial knowledge, personality traits, subjective norms, attitude, and financial self-efficacy on the stock market investment intentions of individual investors. To gather information from individual investors, the study used a cross-sectional research approach, on the population sample of 298 individuals. The data is collected from the Pakistani investors, from three big cities, i.e. Islamabad, Lahore and Karachi, also considered as business centers of the country. The respondents include both the salaried workers and business owners. The findings indicate that attitude and financial self-efficacy were significant mediators for investors’ investment decisions. The results imply that people with a favorable outlook on investing in the stock market, risk-taking and innovative personalities, and financial expertise are more likely make investments. Those who have a mindset towards investing and financial self-efficacy also have more intentions.