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Factors influencing Individual Investor Behaviour: Evidence from the Kuwait Stock Exchange

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  • Sadeq J. Abul

Abstract

This study investigates the effects of psychological factors on investor behaviour regarding the Kuwait Stock Exchange (KSE). These psychological factors are, namely- excessive optimism vs pessimism, herd behaviour and risk appetite. The data for this study obtained from KSE and a survey of a random sample of 398 individual investors. By using qualitative analysis and based on the theory of behavioural finance, the study findings show that herd behaviour, optimism and psychology risk have an impact on the individual investors’ decisions. However, we did not find any evidence of overconfidence behaviour’s effects on investors’ decisions. To our knowledge, KSE has been examined by several researchers without taking into consideration the effects of psychological factors on individual investor decisions. This study finds that psychological factors play a significant role in individual investors’ decisions regarding KSE. This study might contribute positively to the development of this field of research in (KSE).

Suggested Citation

  • Sadeq J. Abul, 2019. "Factors influencing Individual Investor Behaviour: Evidence from the Kuwait Stock Exchange," Asian Social Science, Canadian Center of Science and Education, vol. 15(3), pages 1-27, March.
    • Handle: RePEc:ibn:assjnl:v:15:y:2019:i:3:p:27
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    References listed on IDEAS

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    3. Sanmugam Annamalah & Murali Raman & Govindan Marthandan & Aravindan Kalisri Logeswaran, 2019. "An Empirical Study on the Determinants of an Investor’s Decision in Unit Trust Investment," Economies, MDPI, vol. 7(3), pages 1-23, August.
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    6. Qamar Shabbir Rana, 2022. "Friendship and Finance: Understanding the Social Dimensions of Individual Investor Choices," Magna Carta: Contemporary Social Science, 50sea, vol. 1(3), pages 148-155, September.

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    JEL classification:

    • R00 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General - - - General
    • Z0 - Other Special Topics - - General

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