The influence of five personality factors on investment decisions - the mediating role of financial self-efficacy

An exploratory study of the opinions of a sample of investors in the Iraqi Stock Exchange

Abstract

 The study aims to analyze and diagnose the relationship between the five factors of personality and investment decisions, through financial self-efficacy. The Iraqi Stock Exchange was chosen as a group to conduct the study for a sample size of (189) investors. The study adopted the exploratory and descriptive analytical approach in collecting, analyzing and interpreting information. It also used The questionnaire is a main measurement tool in collecting data and information for the aforementioned sample. The problem of the study was defined: to what extent do the five personality factors of the investor influence his investment decisions through the mediating role of financial self-efficacy in the Iraqi Stock Exchange? A set of statistical programs were used that helped in Analyzing the study data and testing its hypotheses (SPSSV.24, Smart PLS V.3 and Excel). The results demonstrated the existence of an effect of the five personality factors variable on the investment decision-making process, and this effect increases through the mediating variable financial self-efficacy. The study reached a set of conclusions, the most important of which is the existence of a direct influence relationship with significant significance between the five factors of personality and investment decisions, and an indirect influence relationship with significant significance between the five factors of personality and investment decisions through the mediating variable financial self-efficacy. Based on the conclusions, the study presented a set of recommendations, the most prominent of which are: the striving of the stock market management to provide a flexible and effective system to understand the investor’s personality factors, which contributes to raising his financial self-efficacy and thus raising the efficiency of his investment decisions taken, by increasing awareness of the importance of the five factors of personality.