Psychology’s Factors of Stock Buying and Selling Behavior in Indonesia Stock Exchange (Phenomenology Study of Investor Behavior in Surabaya)

Abstract

This study aims to explore the investment understanding and to construct implementation the investment meaning to investment behavior, as well as to construct the model design of investor decision-making behavior in stock buying and selling for short-term investor in Surabaya. This study used a qualitative interpretive paradigm, with phenomenology deontology method. Behavioral finance theory perspective was used as a tool to analyze the results. The results showed that: (1) Compared with fundamental analysis and technical analysis, well emotions management based on age, gender, education and personality of investor/trader was central in determining the success, (2) Compared with other short term investor type, such as a swing trader, position trader and historical investors, the day traders have greatest psychological burden in decision to buy or to sell shares, (3) Short-term investors can manage emotions rightly to obtain greater benefit from short-term investments than long-term investments, (4) experience was the best teacher for trader journey. Traders who able to learn from experience would be better than the traders who understand the stock market science but lack of experience, because the decisions based on a combination of rational and intuitive.