Impact of Personality Traits on Investment Decisions with the Moderating Effect of Financial Literacy

Abstract

At the heart of any economic advancement lies the pivotal decision-making process. For investors seeking to deploy their capital strategically and enhance their returns, the art of selecting investments is paramount. There are several factors to consider before choosing an investment. This study's goal is to evaluate the influence of personality characteristics (extraversion and neuroticism) on investing decisions, with financial literacy serving as a moderating factor. 204 investors and master's level students made up the sample size for the questionnaire survey that was done for this study in order to collect primary data from the intended respondents. Using the SPSS software, this survey was conducted. Analysing the data and verifying the hypotheses involved the use of statistical methods including mean, standard deviations, correlation, and regressions. The analysis's findings indicated that neuroticism, extraversion, and investment decisions all have a significant impact. Financial literacy also has a positive and significant impact on investment decisions, but it does not moderate the relationship between these three variables and investment decisions.