Making Investment Decisions Research Articles

The Influence of Financial Literacy, Overconfidence, and Financial Behavior on Investment Decisions of Students of the Faculty of Economics and Business University of Pembangunan Nasional "Veteran" East Java

This study aims to determine the effect of financial literacy, overconfidence, and financial behavior on investment decisions of students of the Faculty of Economics and Business, University of Pembangunan Nasional East Java. The method applied in this study is a quantitative approach using stratified random sampling techniques. The sample of this study consisted of 98 respondents who had experience in making investment decisions. Data for this study was collected through filling out questionnaires distributed to students of the Faculty of Economics and Business University of Pembangunan Nasional "Veteran" East Java. Data analysis using Partial Least Square (PLS). The findings of this study show that financial literacy has no influence on investment decisions, overconfidence has a significant influence, and financial behavior has a significant influence on investment decisions.

A Financial Playbook for Making Investment Decisions

This study examines the influence of gender, age, education, living area and marital status as socio-demographic indicators and financial literacy toward investment decisions. The research was conducted in South Sulawesi, Indonesia with 167 respondents. The sample used was purposive sampling, with the specific criteria for the level of Indonesian wealth. Quantitative methods and a problem-solving approach were used. We found that gender has a negative and significant effect, education, living area, and marital status positively and significantly affect investment decisions. Women tend to prefer low-risk investments compared to men largely attributed to lower levels of financial literacy among women. In terms of education, investors with higher levels of education are more likely to make more informed investment decisions as they demonstrate improved risk management skills and a higher level of financial literacy. The living area also influences their investment decisions, with urban investors having easier access to information and knowledge about investments. Marital status also affects investment decisions, as married investors often prioritize the responsibility of their investments. However, age have a negative and not significant on investment decisions. This can be explained by the higher number of younger people becoming involved in investment decisions.

ANALISIS PENGARUH RISK PERCEPTION, RISK TOLERANCE, OVERCONFIDENCE, DAN LOSS AVERSION TERHADAP KEPUTUSAN INVESTASI GENERASI MILIENIAL

This study aims to determine the factors that influence investment decision making for millenial generation in Cilacap, Central Java. The research use quantitive method with primary data collected by distributing questionnarires. The millenial generation in Cilacap is the population in this study with sample used is 101 respondents. Data was analyzed using IBM SPSS Statistics 20. The result show that Risk perception and loss aversion influences the investment decision of the millenial generation in Cilacap. This means that the higher person perception of risk and loss aversion, the more careful the person will tend to be in making investment decision. Meanwhile, risk tolerance and overconfidence does not influence the investment decision of the millenial generation in Cilacap

Unlocking the Sustainable Workplace Equality Policy (SWEP): Evidence from an Emerging Country

Businesses are actively integrating sustainability principles into their operations by pursuing goals that go beyond reputation management, which all help companies capture value through growth and return on investment. This study aimed to investigate the current status of the Sustainable Workplace Equality Policy (SWEP) in an emerging country—Kuwait—and how it impacts firms’ financial and market performance. This study included companies listed in the Kuwait Boursa (Boursa Kuwait is the operator of the Kuwait Stock Exchange) in the period between 2016 and 2021. A disclosure index was prepared for SWEP based on guidelines provided by a combination of various sources and standards such as the Global Reporting Initiatives (GRI) Standard, S&P Global Corporate Sustainability Assessment, Dow Jones Sustainability Index, United Nations Global Compact, and KPMG Sustainability Reporting Standards. Time series regression analysis was used to examine the hypotheses of this study which were developed using Rawls’ Theory of Justice (1971). The results revealed a strong positive relationship between SWEP disclosure and firm measures of financial performance. The results also indicate that SWEP is value-relevant and affects firms’ market value, suggesting that investors consider firms’ disclosure of SWEP when making investment decisions in Kuwait. The results of the current study are of interest to several stakeholders, especially investors and policymakers. Specifically, this study is relevant to the Kuwaiti Government, which has defined a clear path for sustainable growth with the Vision 2035/New Kuwait initiative that is aimed at transforming the country into a financial and commercial hub for the region by 2035.

Financial statement analysis was conducted to assess the financial performance of PT Unilever Indonesia Tbk in the 2018-2022 period using the Current Ratio, Debt Equity Ratio, and Return on Asset

Financial performance is a formal effort to evaluate the efficiency and effectiveness ofa company in generating profits. The method used is a qualitative method using a descriptive approach; the subject in this study is PT Unilever Indonesia Tbk and the object in this study is the financial statement data of PT Unilever Indonesia Tbk. The data source used in this study is secondary data taken from the official website of PT Unilever Indonesia Tbk. This study aims to determinethe financial performance of PT Unilever Indonesia Tbk using the CurrentRatio, debt-to-equityRatio, and return on assets. It is expected to provide helpful information for companies and investors in making investment decisions. Based on the attached data, it shows that during the 2018-2022 period, the average Ratio of each Ratio in PT Unilever Indonesia Tbk is as follows: at the liquidity ratio of current assets of 8,178,740 and current liabilities of 12,488,997. At the Ratio of total debt solvency of 14,415,546 and total equity of 5,223,178. Theprofitability ratio of total assets amounted to 56,794,724, and net profit amounted to 6,955,753. From the results of this study, the Company's financial performance shows a low level of liquidity, a higher level of risk due to the use of more considerable debt, and suboptimal operational performance. Therefore, companies must pay attention to cost management, debt management, and sales activities to improve financial performance. TheCompanyCompany should increase sales toenhance efficient financial performance. This research is expected to make theoretical contributions to the literature in this context, including in the context of economic and banking management.

Do crude oil, gold and the US dollar contribute to Bitcoin investment decisions? An ANN-DCC-GARCH approach

PurposeBitcoin (BTC) is significantly correlated with global financial assets such as crude oil, gold and the US dollar. BTC and global financial assets have become more closely related, particularly since the outbreak of the COVID-19 pandemic. The purpose of this paper is to formulate BTC investment decisions with the aid of global financial assets.Design/methodology/approachThis study suggests a more accurate prediction model for BTC trading by combining the dynamic conditional correlation generalized autoregressive conditional heteroscedasticity (DCC-GARCH) model with the artificial neural network (ANN). The DCC-GARCH model offers significant input information, including dynamic correlation and volatility, to the ANN. To analyze the data effectively, the study divides it into two periods: before and during the COVID-19 outbreak. Each period is then further divided into a training set and a prediction set.FindingsThe empirical results show that BTC and gold have the highest positive correlation compared with crude oil and the USD, while BTC and the USD have a dynamic and negative correlation. More importantly, the ANN-DCC-GARCH model had a cumulative return of 318% before the outbreak of the COVID-19 pandemic and can decrease loss by 50% during the COVID-19 pandemic. Moreover, the risk-averse can turn a loss into a profit of about 20% in 2022.Originality/valueThe empirical analysis provides technical support and decision-making reference for investors and financial institutions to make investment decisions on BTC.

Determinants Of Earning Persistence In Consumer Cyclicals Sector In Indonesia

Companies need income persistence in maintaining performance in the capital market. Income persistence will be a consideration for investors in making investment decisions. This study analyzes the factors of total accruals, real earnings management, cash flow volatility, and leverage that can affect income persistence in consumer cyclicals companies listed on the Indonesia Stock Exchange in 2017-2020. Sampling method with purposive sampling method. There were 42 samples that met the criteria. The analysis used multiple regression analysis which was processed using SPSS 22. The research showed that total accruals, cash flow volatility, and leverage had no effect on earnings persistence, but real earnings management showed an effect on income persistence. However, real earnings management showed effect on earnings persistence. The implication of this research is that every company must pay attention to these four factors in the current year so that it shows good and resilient corporate finance which can provide a positive signal for investors so that it increases the company's share price in the capital market.

ESG rating and short selling in the corporate bond market

This paper explores the effect of ESG ratings on corporate bond short interest. Using corporate bond data from 2006 to 2022, we show that higher issuers’ ESG scores are associated with lower bond short interest. Further examination reveals that changes in ESG scores can predict future changes in bond ratings. Overall, our findings suggest that bond short sellers consider issuers’ ESG scores as valuable indicators in making investment decisions.

The Impact of Environmental, Social, and Governance Factor on the Financial Performance of China's Companies

This study looks at how ESG concerns affect the bottom lines of Chinese businesses. China has become the latest country to impose mandatory ESG reporting requirements on publicly traded corporations. This study provides evidence that Chinese firms that put an emphasis on ESG aspects are more likely to have long-term success. Investors should take ESG performance into account due to the beneficial relationship between social and environmental performance and financial success. In addition, regulators might encourage openness and responsibility by making ESG disclosures subject to the comply or explain approach. The theoretical foundations of stakeholder and principal-agent theories are investigated alongside recent ESG developments in China and associated laws. The study looked at information from 101 Chinese public businesses Financial success was shown to be positively correlated with social and environmental performance, whereas governance performance had no discernible effect. The study has findings that have important implications for both investors and regulators. The findings show that investors may place greater focus on ESG performance when making investment decisions. The Chinese economy will expand more sustainably if the problems with ESG reporting are solved.

Modelling the effect of macroeconomic factors on residential real estate investment returns in Abuja and Lagos, Nigeria

PurposeThis study evaluated the effect of macroeconomic factors on residential real estate (RE) investment returns in the cities of Abuja and Lagos, Nigeria, with a view to guiding RE investors and researchers.Design/methodology/approachA survey research design was employed using a questionnaire to collect RE transaction data from 2008 to 2022 from estate surveying and valuation firms in the study areas. Rental and capital value data collected were used to construct rental and capital value indices and total returns on investment. The macroeconomic data used were retrieved from the archives of the Central Bank of Nigeria (CBN). Granger causality (GC) and multiple regression models were adopted to evaluate the effect of selected macroeconomic variables on residential RE investment returns in the study areas.FindingsThe study found a progressive upward movement in rental and capital values of residential RE investment in the study areas within the study period. Total and risk-adjusted returns on investment were equally positive within the study period. Only the inflation rate, unemployment rate and real gross domestic product (GDP) per capita were found to be the major determinants of residential RE investment returns in the study areas within the study period.Research limitations/implicationsThe secrecy associated with property transaction information/data by RE practitioners in the study areas posed a challenge. Property transaction data were not adequately kept in a way for easier access and retrieval in many of the estate firms and agent offices. Consequently, there was a lack of data that spanned the study period in some of the sampled estate firms or agent offices. This data collection challenge was, however, overcome by the excess time spent retrieving the required data for this study to ensure that the findings appropriately answer the research questions. Practical implicationsInflation and GDP per capita have been found to be significant factors that influence residential RE investment performance in the study areas. Therefore, investors should pay attention to these identified macroeconomic factors for residential RE investment in the study areas whilst making investment decisions in order to mitigate a possible loss of income or return. The government should formulate and implement economic policies that would address the current high unemployment and inflation rates in Nigeria at large.Originality/valueThis study has extended and further enriched the existing body of knowledge in the field of RE investment analysis in Nigeria. To the best of the authors' knowledge, this study is the first to adopt the Cornish Fisher value-at-risk and modified Sharpe ratio models to analyse risk and risk-adjusted returns on residential RE investment, respectively, in Nigeria. It has therefore redirected the focus of RE researchers and practitioners to a more objective approach to RE investment performance analysis in Nigeria.

PENGARUH INFLASI, NILAI KURS DAN SUKU BUNGA TERHADAP RETURN SAHAM PADA PERUSAHAAN PERBANKAN YANG TERDAFTAR DI BURSA EFEK INDONESIA


 
 
 
 Stock return is the return obtained from investment. Investors' expectations in investing in stocks other than being the owner of a company with a certain proportional ownership, the shares invested are expected to be able to provide a certain rate of return. The purpose of this study was to determine the effect of inflation, exchange rates and interest rates on stock returns in banking companies listed on the Indonesia Stock Exchange for the period 2017-2019.
 The population in this study were all banking companies listed on the Indonesia Stock Exchange for the 2017-2019 period, totaling 45 companies. The sampling technique used purposive sampling method, in order to obtain a sample of 27 company samples. The data collection method used in this study is secondary data with documentation techniques by collecting existing online documents in the form of financial reports obtained from www.idx.co.id. With the number of observations for 3 consecutive years. The data analysis technique used is multiple linear regression using the SPSS version 16 program.
 The results of this study indicate that the independent variable inflation, exchange rates and interest rates have an effect on stock returns with a significance value of 0.000 <0.05. The results of the study that partially Inflation has an effect on Stock Returns indicated by a significance value of 0.000 <0.05. Exchange rate has an effect on Stock Return indicated by a significance value of 0.000 <0.05. Interest rates have an effect on Stock Returns indicated by a significance value of 0.000 <0.05.
 The conclusion from the results of this study is that inflation, exchange rates and interest rates affect Stock Returns in banking companies listed on the Indonesia Stock Exchange for the period 2017-2019. Suggestions that can be conveyed to investors who are going to invest are advised to pay more attention to these variables in making investment decisions so as to reduce investment risks such as decreased stock returns
 
 
 

OTHER COMPREHENSIVE INCOME IN THE INTERNATIONAL FINANCIAL REPORTING STANDARDS: A LITERATURE REVIEW

Research Purposes. This research aims to examine studies regarding investor and contractual profits from Other Comprehensive Income (OCI), as well as its components can provide more evidence regarding whether there are characteristics that differentiate between OCI. Research Methods. This research is research using literature review.The process of reviewing selected articles focuses on understanding the problem, context, complexity and subjectivity of researchers in studying and interpreting OCI’s conceptions and OCI components (and AOCI) and their various relevance that are beneficial to investors in IFRS. Google search, www.semanticcholar.org and onlinelibrary.wiley.com were used to find journal special issues. Research Results and Findings. OCI information and OCI components in the IFRS standard income statement are little use to investors, especially for assessing risk in making investment decisions. Investors should be careful not to overly consider OCI information and OCI components (and AOCI) when making investment decision, including debt contracts.

The impact of environmental, social, and governance information on individual stock investment decisions

The global business landscape has seen a growing necessity for companies to implement and disclose environmental, social, and governance (ESG) information (AlHares et al., 2023). Driven by the expectations of investors and society, companies find themselves obligated to publish ESG reports. Therefore, this study focuses on exploring the impact of ESG information on the investment decisions made by individual investors in Vietnamese stock markets. By employing the theory of planned behavior (TPB) and conducting a comprehensive survey, coupled with logistic regression analysis on a sample of 232 individual investors, our research uncovers a significant influence of ESG information on the stock decision-making process of these investors. Notably, our findings reveal that investors place greater emphasis on governance (G) information compared to social (S) and environmental (E) information when making investment decisions. This trend aligns with the conclusions drawn by Sultana et al. (2018) and Mehwish et al. (2022) but diverges from the findings of Rounok et al. (2023). These findings are poised to catalyze the disclosure of ESG reports among listed companies. They also impel policymakers to craft and implement policies actively promoting ESG reporting. Such initiatives will likely foster increased interest and bolster investments in companies adhering to ESG criteria, particularly among individual investors in emerging stock markets.

An Interval-Valued Intuitionistic Fuzzy VIKOR Approach for R&D Project Selection in Defense Industry Investment Decisions

Defense Industry projects are high-budget projects that take many years, required infrastructure, and go through serious research and development processes. When making investment decisions, solutions obtained with models based on expert opinions and analytical techniques are required. At this point, interval-valued intuitionistic fuzzy (IVIF) methods are a good alternative to eliminate uncertainty, especially in order to evaluate all preference information provided by decision makers. In this study, multi-criteria decision making in the IVIF environment in the defense industry is extended with the VIKOR method. For the application, the literature was examined and 8 different criteria were determined. 4 different alternative projects were evaluated based on these criteria by 3 different decision makers. The results show that the analyzes performed with the VIKOR method in the IVIF environment are similar to the literature. Additionally, there is no study in the literature examining this methodology on the defense industry.

Manajemen Laba: Strategi Bisnis, Investment Opportunity Set, Managerial Entrenchment dan Ukuran Perusahaan

One of the most important information is profit information that investors can consider when making investment decisions. Company managers use this information to commit financial statement fraud at profit levels to increase company profits, one of which is earnings management practices. The purpose of this research is to examine and determine the effect of business strategy, investment opportunity set, managerial entrenchment and firm size on earnings management. The population used in this study are transportation and logistics companies listed on the Indonesia Stock Exchange (IDX) in the 2017-2021 period. Sampling by method purpose sampling and according to the criteria obtained 70 sample units from 14 companies within 5 years. Data analysis using panel data regression. The results of the study show that business strategy, investment opportunity set, managerial entrenchment and firm size simultan eously influence earnings management. Partially, business strategy, managerial entrenchment and the size of the company has no effect on Earnings Management. Whereas, investment opportunity set has a positive influence on Earnings Management.

BEHAVIOURAL BIASES INFLUENCING INVESTMENT DECISIONS OF INDIVIDUAL INVESTORS

The aim of this present study is to ratify the scale of behavioural biases such as overconfidence, herding effect, loss aversion and investment decisions relating to individual investors who invest in Indian stock market. The present study assesses the influence of aforesaid behavioural biases on investment decisions made by individual investors. The study is based on a questionnaire investigation by including the individual investors of Indian stock market residing in Bihar (India) using a convenient sampling technique. 500 hundred questionnaires have been distributed among the individual investors and 428 responses has been taken into consideration for the present study. The collected data were analysed through multiple regression using SPSS. The present study found that the scale used to measure behavioural biases and investment decisions of individual investors were valid and overconfidence biases have a significant influence on investment decisions of individual investors. In contrary, herding effect and loss aversion does not significantly influence the investment decision of individual investor. The present study found that the individual investors are behaviourally biased while making investment decisions. The present study backs to the academia of behavioural aspects and individual investors who invest in Indian stock market. The present study supports in understanding the concept of behavioural biases of individual investors investing in Indian stock market.

Minds and Machines: Impact of Emotional Intelligence on Investment Decisions with Mediating the Role of Artificial Intelligence

In the evolving landscape of financial decision-making, this study delves into the intricate relationships among Emotional Intelligence (EI), Artificial Intelligence (AI), and Investment Decisions (ID). By scrutinizing the direct influence of human emotional intelligence on investment choices and elucidating the mediating role of AI in this process, our research seeks to unravel the complex interplay between minds and machines. Through empirical analysis, we reveal that EI not only directly impacts ID but also exerts its influence indirectly through AI-mediated pathways. The findings underscore the pivotal role of emotional awareness in investor decision-making, augmented by the technological capabilities of AI. It suggests that most investors are influenced by the identified emotional intelligence when making investment decisions. Furthermore, AI substantially impacts investors' decision-making process when it comes to investing; nevertheless, AI partially mediates the relationship between emotional intelligence and investment decisions. This nuanced understanding provides valuable insights for financial practitioners, policymakers, and researchers, emphasizing the need for holistic strategies that integrate emotional and technological dimensions in navigating the intricacies of modern investment landscapes. As the synergy between human intuition and artificial intelligence becomes increasingly integral to financial decision-making, this study contributes to the ongoing discourse on the symbiotic relationship between minds and machines in investments.0

Pengaruh Return on Asset, Return on Equity Terhadap Harga Saham pada Perusahaan Manufaktur Sub Sektor Food and Beverage yang Terdaftar di Bursa Efek Indonesia pada Tahun 2019–2021

This research aims to investigate the influence of Return on Assets (ROA) and Return on Equity (ROE) on share prices in manufacturing companies in the Food and Beverage sub-sector listed on the Indonesia Stock Exchange during the 2019–2021 period. The sampling method used was purposive sampling with certain criteria. Ten companies were selected as samples from a population of 47 Food & Beverage Manufacturing companies after applying the purposive sampling method. Analysis was carried out through multiple regression and hypothesis testing using the partial t-test, simultaneous F test with a significance level of 5%, and coefficient of determination test. This research aims to provide a deeper understanding of the relationship between Return on Assets (ROA) and Return on Equity (ROE) with stock prices in the context of Food and Beverage manufacturing companies. The results of this research are expected to provide a significant contribution to academic and practical literature in the field of corporate finance. Therefore, this research has relevant implications for investors, company management, and interested parties in making investment decisions in the Food and Beverage sector.

The Relationship Between ESG Metrics and Financial Performance of an Enterprise in the Oil and Gas Sector

This article explores the relationship between ESG (environmental, social and corporate governance) indicators and the financial performance of enterprises. It analyzes data from companies included in the RAEX ESG rating in order to build a linear regression model that demonstrates the dependence of financial indicators, such as return on equity (ROE) and return on assets (ROA), on factors related to sustainable development. The results showed that company performance in the area of sustainability on the E-rating reduces the variability of stock returns and the efficiency of assets use, while increasing return on equity; a rise in the rating on the S indicator leads to an increase in all selected financial indicators of the company; an increase in the G-ranking has a negative effect on stock volatility, but leads to a decrease in return on equity and assets. Components of an ESG rating, especially corporate governance indicators, can both positively and negatively impact company financial performance. The modeling results confirm the existence of a significant relationship between the implementation of sustainable development principles and the financial results of companies, which emphasizes the importance of taking into account ESG factors when assessing the performance of enterprises and making investment decisions. The study provides data for further inquiry into the role of sustainable development in improving the financial performance of enterprises and forming effective management strategies.

ПОДХОД К ОЦЕНКЕ ЭФФЕКТИВНОСТИ ПАЕВЫХ ИНВЕСТИЦИОННЫХ ФОНДОВ, ИСПОЛЬЗУЮЩИХ ФИНАНСОВЫЕ ИНСТРУМЕНТЫ ПОД УПРАВЛЕНИЕМ ИСКУССТВЕННОГО ИНТЕЛЛЕКТА НА РЫНКЕ ЦЕННЫХ БУМАГ

The 21st century is an era of information technology. The rapid development of financial technology has brought huge changes to investors’ lives. The emergence of artificial intelligence has made financial investment activities simpler and more efficient, and automated investment has become possible. Artificial intelligence can, to a certain extent, replace investors in making investment decisions, improve investment efficiency, and reduce work costs. Smart finance and technological finance are the mainstream development directions of the financial market. The use of artificial intelligence can increase the profitability and efficiency of mutual funds.