Jurnal Keuangan dan Perbankan Universitas Merdeka Malang
Investors psychology on the biased investment decision: The mediating effect of extra motivation to inves

Jurnal Keuangan dan Perbankan Universitas Merdeka Malang
Investors psychology on the biased investment decision: The mediating effect of extra motivation to inves

Extra motivation to invest; Investment decision;
Investor psychology

This study aims to prove that individual investors’ psychology consisting of positive attitude, ffective-self affinity, familiarity, trust, and nationalism affects investment decisions mediated by the extra motivation to invest. The data collected through questionnaires were processed and tested for the validity and reliability of the construct. Respondents in this study are individual investors who use psychological considerations as more motivation to make decisions and 404 questionnaires distributed to individual investors. This study uses Partial Least Square (PLS). It passes
the fit and quality indices model criteria to determine the strength of this study’s structural model before the hypothesis testing is carried out. We found four psychological variables of individual investors (positive attitude, familiarity, trust, and
nationalism) that directly affect investment decisions and indirectly with the mediator of extra motivation to invest. Extra incentive to invest is not influenced by affective-self affinity and does not mediate its relationship with investment decisions.
We also found that investors with psychological considerations tend to make biased decisions. Investors show behaviour that is overreaction, overconfidence, and risk tolerance (low risk with high return).

Muhammad Zalviwan, Haryono Tulus, Sri Runing Sawitri Hunik

http://jurnal.unmer.ac.id/index.php/jkdp

Universitas Merdeka Malang

October 2020

Sri Wahyuni

ISSN: 2443-2687 (Online) ISSN: 1410-8089 (Print)

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Jurnal Keuangan dan Perbankan Universitas Merdeka Malang