The Relationship of Investor’s Demographic Traits and Personality Type with Financial Risk Tolerance in Investment Decisions.

Abstract

With an assorted sample of customers from various banks of Pakistan, the authors tried to establish relationship of investor’s demographic traits and personality type with financial risk tolerance during the choice of investment. Results provide sustenance for the projected hypotheses such as investor’s age, income, financial knowledge, family size, occupation and academic qualification has association with financial risk tolerance capability.Investors doing service in an organization tolerate more risk as compare to the investor having their own business. However, Investors marital status and gender has no effect on financial risk tolerance. Investor either married or unmarried showed similar attitude toward financial risk tolerance. Empirical results also provide evidence that investors having type A personality are more financial risk taker as compare to type B personality.