Stock Investment Decisions Research Articles

Company Value as Consideration in Making Individual Stock Investment Decisions (Hermeneutical-Critical Study)

Individual stock investor has many options in an investment and investment decision was influenced by so many factors, one of them is value of the firm. Value of the firm is often associated with stock price. The higher stock price means the better value of the firm. This mini-research used critic-hermeneutic research approach. Hermeneutic used for interpretation of text which told by individual stock investors in the interview. There were 8 informant interviewed in this mini-research, who had different backgrounds i.e employee, entrepreneurs, and college students. The result showed that value of the firm as useful value for investors, actually didn’t entirely used by individual stock investors, especially for investors who used technical analysis and another non-fundamental analysis in their stock analysis. Investor’s sophistication in value of the firm analysis also influenced by the other investor, so they didn’t analize it anymore. When value of the firm didn’t influence the investment decision of investor, no-effect hypothesis was applied. Whereas more sophisticated investor considered value of the firm in their investment decision. When value of the firm influenced to the investment decision of investor, mechanistic hypothesis was applied.
 
 Keywords: Individual stock investor, investment decision, value of the firm.

Analisis Literasi Keuangan, Overconfidence dan Toleransi Risiko Terhadap Keputusan Investasi Saham

During the Covid-19 pandemic, the number of stock investors has increased significantly, where the more investment activities there are, the more factors and basis for making investment decisions. The purpose of this study is to analyze the effect of financial literacy, overconfidence and risk tolerance on stock investment decisions in the people of Batam City. The approach used in this research is quantitative method, where data is collected by distributing questionnaires in the form of a Likert scale questionnaire with purposive sampling technique with a sample of 160 respondents. The data analysis method is in the form of multiple linear regression analysis using the SPSS version 25 application. The results show that financial literacy has a positive effect on stock investment decisions, overconfidence has a positive effect on stock investment decisions and risk tolerance has a positive effect on stock investment decisions.
 Keywords: Financial Literacy; Overconfidence; Risk Tolerance; Investment Decision.

Humanoid psychological sentiments and enigma of investment

PurposeThe primary goal of this study is to look at the behavioral factors that influence an individual's decision to invest in the Pakistan Stock Exchange (PSX).Design/methodology/approachExisting behavioral finance theories serve as a foundation for hypotheses. Further hypotheses were investigated by disseminating questionnaire results from a number of individual Pakistani investors. Brokerage and asset management fund managers were also questioned in semi-structured interviews. The obtained data were analyzed using statistical package for the social sciences, and latent variables were identified using the structural equation model (SEM) and an asset management operating system (AMOS).FindingsIndividual investor investment decisions in the PSX are influenced by five behavioral factors: herding, market, prospect, overconfidence and gambler fallacy and anchoring-ability bias. The majority of the variables have a modest impact; however, the market component has a significant impact. Only three behavioral elements, herding, prospect and heuristic, are found to influence investment performance among the behavioral factors stated above. Heuristic habits have been discovered to have the greatest positive impact on investment performance.Practical implicationsThis study is one of the few in Pakistan that looked at the factors that influence stock investment decisions using behavioral finance. Prior research has only considered the effects of a restricted number of behavioral characteristics on Pakistani individual investors; however, this study seeks to use a whole collection of behavioral factors to examine their impacts on Pakistani individual investors.Research limitationsThe focus of the study remains on the individual investor, whereas the impact of institutional investors on investment behavior could bring different outcomes.Originality/valueThis is among the few studies that investigated the impact of cognitive factors on investment decisions in the context of Pakistan and will help policy makers, opinion makers and individuals.

Stock Investment Decision: The Effects of Personal Factors and Moderating Role of Years of Service

This paper aims to elaborate stock investment decision and to examine the impact of five influential factors as independent variables and the influence of years of investment as mediating variable. This paper is based on empirical study which involved 286 individual investors in Indonesia Stock Exchange using data from Riri et.al (2020). Structural equation modelling approach was used for estimating relationship between influential factors (e.g., personal financial needs, overconfidence, advocate recommendation, social relevance, and self or firm image) on stock investment decisions. The result found that decision on stock investment is determined by social relevance, overconfidence, personal financial need, and advocate recommendation significantly and positively. Years of Investment has played moderating role on relationship between for advocate recommendation and personal with stock investment decisions. Years of Investment is moderating variable to become a novelty this paper.

Stock Closing Price Prediction of ISX-listed Industrial Companies Using Artificial Neural Networks

Making stock investment decisions is a complex challenge that investors continuously face. When it comes to an uncertain future, making the wrong decision can result in massive losses. The paper aims to develop an artificial neural networks-based model predicting the closing price of top-six traded industrial ISX-listed stocks, which can guide investment decisions. The sample consisted of daily indexes ISX-released from (3/3/2019) to (31/3/2019). Matlab 2014b was used to run artificial neural networks using the nntool software. The model's performance was evaluated using Mean squared error (MSE), Root means squared error (RMSE), and R squared. Empirical results demonstrated the ability and efficiency of artificial neural networks to predict closing prices with high accuracy. As a result, we recommended employing the Artificial Neural Networks model to predict stock prices as well as relying on it to make decisions.

The Influence of Perceived Return Level and Financial Literacy Level on Individual Stock Investment Decision Making

The purposes of this study are 1) To analyze the effect of perceived return on stock investment decision making. 2) To analyze the effect of financial literacy on stock investment decisions. 3) To analyze the effect of perceived returns and financial literacy on stock investment decisions. This study uses a quantitative approach, by collecting questionnaire data and using purposive sampling technique. The sample used as many as 100 investors Capital market Community Surabaya and surrounding areas. The data analysis technique used is the inner model test, outer model test and hypothesis testing using the SmartPLS version 3.0 program. The results of this study obtained based on the validity test of the questionnaire statement were declared valid. For the reliability test of the Cronbach alpha value of > 0.7, it is declared reliable. And to test the hypothesis based on the value of the inner weight on the Path Coefficients, it shows that tcount for variables X1 and X2 has a significant positive effect. The results of tcount for Perceived Return (X1) are 2,908 and financial literacy are 2.292.

Forecasting the box offices of movies coming soon using social media analysis: A method based on improved Bass models

Forecasting the box offices of movies is indispensable, whether it is for the stock investment decisions of the movie company, the movie sales strategy design of the advertising company, or the movie screening schedules of cinemas. However, this task is very challenging because it is affected by many complicated factors. In view of this complexity, we propose a method for forecasting the box offices of movies coming soon based on social media analysis. First, movie-related online reviews and their numbers are collected from microblogs. Second, several important features, i.e., the sentiment value of microblog texts, the consumers’ RFM value and the degree of moviegoers’ attention, are extracted or calculated. Subsequently, we use the extracted features to expand the parameters of the Bass model, and build two improved Bass models for forecasting the box offices of movies in the initial week and during the diffusion cycle, respectively. Finally, through fitting data progressively, we realize the forecasting task. The experimental results show that compared with the traditional forecast models and existing studies, the improved Bass method proposed in this paper has better performance, overall.

ANALISIS PERILAKU GENERASI MILENIAL DALAM PENGAMBILAN KEPUTUSAN INVESTASI SAHAM DI MASA PANDEMI COVID-19

This study aims to analyze the behavior of the millennial generation in making stock investment decisions during the Covid-19 pandemic. This research method uses a qualitative method with a case study approach. The research subjects were four people who were included in the millennial generation category who were under 30 years old and domiciled in Solo Raya. The results of this study indicate that the behavior of investors in making stock investment decisions is based on the declining stock price trend due to the Covid-19 pandemic, influenced by the herding bias factor, namely following the actions or suggestions of others, but also analyzing the company's performance by looking at its financial statements.Keywords: Covid-19; Investor Behavior; Investment Decisions; Millenial Generation

Literasi Keuangan dan Faktor Sosiodemografi terhadap Keputusan Investasi melalui Bias Perilaku

This study examines the effect of financial literacy and sociodemographic factors on stock investment decisions through behavioral bias as a variable intervention. By using purposive sampling technique, so that the number of research samples obtained was 109 members of investment galleries at State Islamic University Maulana Malik Ibrahim Malang, Brawijaya University, and State University of Malang. The results showed that financial literacy affects stock investment decisions and behavioral bias, while sociodemographic factors do not affect them. Behavioral bias influences stock investment decisions and it can mediate the effect of financial literacy on stock investment decisions but it is unable to mediate sociodemographic factors towards stock members' invest.

The Analysis of Factors that Influencing Investors Decision of Stock Investment in Batam

Abstarct The present study aims to seek the factors within an investor which can influence the stock investment decision in City of Batam with locus of control as a moderating variable. There are four variables used in this study, conservatism, availability, hearding , and overconfidence bias. Primary data were collected from online and offlin e by distributing questionnair e to investors in City of Batam. Total respondents in this study are 172 investors which are cleared from outlier. Then, t he data were examined through SPSS version 25. Base on data analysis the result be concluded that variables of conservatism, availability, hearding , and overconfidence bias can affect positive significantly towards investment decision making. Universitas Internasional Batam Keywords: Stock Investor, Investment Decision Making , Conservatism, A vailability, Hearding , and O verconfidence bias

The impact of board composition and ownership structure on dividend payout policy: evidence from Saudi Arabia

PurposeThis study examines the impact of board composition and ownership structure variables on dividend payout policy in Saudi Arabian firms. In particular, it aims to determine the effect of board size, independence and meeting frequency, in addition to chief executive officer (CEO) duality, and state, institutional, managerial, family, and foreign ownership on both the propensity to pay dividends and dividend per share for Saudi-listed firms over the period 2016–2019.Design/methodology/approachThe paper captures dividend policy with two measures, propensity to pay dividends and dividend per share, and employs a range of regression methods (logistic, probit, ordinary least squares (OLS) and random effects regressions) along with a two-stage least squares (2SLS) model for robustness to account for heteroscedasticity, serial correlation and endogeneity issues. The data set is a large panel of 280 Saudi-listed firms over the period 2016 to 2019.FindingsThe results underline the importance of board composition and the ownership structure in explaining variations in dividend policy across Saudi firms. More specifically, there is a positive relationship between the propensity to pay dividends and board-meeting frequency, institutional ownership, firm profitability and firm age, while the degree of board independence, firm size and leverage exhibit a negative relation. Further, dividend per share is positively related to board meeting frequency, institutional ownership, foreign ownership, firm profitability and age, while it is negatively related to CEO duality, managerial ownership, and firm leverage. There is no evidence that family ownership exerts an impact on dividend payout policy in Saudi firms. The findings of this study support agency, signalling, substitute and outcome theories of dividend policy.Research limitations/implicationsThis study offers an important insight into the board characteristic and ownership structure drivers of dividend policy in the context of an emerging market. Moreover, the study has important implications for firms, managers, investors, policymakers, and regulators in Saudi Arabia.Originality/valueThis paper contributes to the existing literature by providing evidence on four board and five ownership characteristic drivers of dividend policy in Saudi Arabia as an emerging stock market, thereby improving on less comprehensive previous studies. The study recommends that investors consider board composition and ownership structure characteristics of firms as key drivers of dividend policy when making stock investment decisions to inform them about the propensity of investee firms to pay dividends and maintain a given dividend policy.

FAKTOR PSIKOLOGIS INVESTOR MILLENIAL DALAM PENGAMBILAN KEPUTUSAN INVESTASI SAHAM (Studi Empiris Pada Investor Millenial di Kota Ambon)

Behavioral finance is an approach that explains how humans invest or relate to finances influenced by psychological factors. Behavioral financial theory states that an investor is not always rational in making investment decisions and tends to use psychological aspects. The purpose of this research is to examine the effect of overconfident and herding behaviour to investment decisions of millennial in Ambon city. The population in this study are millennial investors in the city of Ambon and the sample used is 96 respondents. The sampling technique used purposive random sampling, the data in this study used primary data in the form of a questionnaire. The data analysis technique is multiple regression analysis. The results of the study show that overconfidence and herding behavior have a positive and significant effect on the stock investment decisions of millennial investors in Ambon city. The coefficient of determination test shows the Adjusted R2 value of 0.159 or 15.9%, which means that the stock investment decision variable is influenced by overconfidence and herding behavior variables and the remaining 84.1% is influenced by other variables.

Investor’s behavior and stock investment decision in batam city

This study aims to analyze the influence of investor’s behavior on investment decisions in stock investing in Batam City. The investor’s behavior consists of heuristic theory, herding behavior, and prospect theory. The heuristic theory used in this study consists of representativeness, overconfidence, availability, and anchoring. Whereas prospect theory consists of loss aversion, regret aversion, and mental accounting. This study used a purposive sampling method, which is the sample is selected by the criteria that are the investor who has a stock investment in Batam. The total sample is 200 respondents. The research method is multiple regression with SPSS software. The results show that there are only three behaviors from the heuristic theory that have a significant effect on investment decisions, namely representativeness, availability, and anchoring. Meanwhile, overconfidence does not have a significant effect. Herding behavior does not have a significant effect. Meanwhile, prospect theory is only mental accounting behavior that has a significant effect and loss aversion and regret aversion have no significant effect.

Investment decision by using Capital Asset Method Pricing Model (CAPM) (Case studies on five automotive companies listed in stock exchange)

Investment is a tool for investors to get more profit than what has been invested. Investors must be able to predict the possibilities that occur when investing. Capital Asset Pricing Model is a tool to predict the development of investment in a particular company used to calculate and determine the Expected Return in minimizing risk investments. The authors conducted research using a sample of 5 companies in the automotive industry, namely PT Astra International Tbk, PT Indokordsa Tbk, PT Indomobil Sukses Internasional Tbk, PT Astra Otoparts Tbk, and PT Gajah Tunggal Tbk. This study uses a descriptive quantitative approach with Microsoft Excel 2016 analysis tools. This study aims to determine Portfolio Analysis with the Capital Asset Pricing Model (CAPM) approach which is used as the basis for making stock investment decisions in automotive industry sector companies listed on the Indonesia Stock Exchange. Use from the results of the analysis of the results by comparing the value of E(Ri) has a directly proportional relationship, meaning that the higher the value of, then the stock return (E(Ri)) will be high as well. Of the 5 companies, there are 2 companies that are in the Undervalued category and 3 companies that are in the overvalued category. This means that investors who will invest in companies engaged in the automotive industry can decide to buy shares of the companies PT Indomobil Sukses Internasional Tbk and PT Gajah Tunggal Tbk, because they are classified as undervalued. Meanwhile, investors who want to invest in shares are not advised to buy company shares that are in the overvalued category, but are advised to sell them to investors who already have shares in the company.

IMPACT DPS EPS ON STOCK PRICE AND INVESTMENT DECISION

Tujuan dari penelitian ini adalah untuk mengetahui faktor-faktor yang mempengaruhi harga saham dan membuat analisis fundamental industri manufaktur di sektor barang konsumsi selama periode 2014 hingga 2018 di Bursa Efek Indonesia. Dalam penelitian ini digunakan data dari 16 perusahaan manufaktur. Pengaruh laba dan dividen per saham ditentukan dengan menggunakan model regresi berganda. Hasil penelitian menunjukkan bahwa deviden per saham dan laba per saham berpengaruh positif dan signifikan terhadap harga saham perusahaan manufaktur sub sektor barang konsumsi yang terdaftar di BEI. Selain itu, penelitian ini juga memberikan pertimbangan kepada investor untuk memilih alternatif investasi melalui analisis fundamental .

Model Dynamic Ensemble Time Series untuk Prediksi Indeks Harga Saham Utama di Indonesia Pasca Pandemi

Forecasting or predicting stock prices in the form of time series data is still a hot topic consistently discussed in economic forums and financial markets. This article had been analyzed prediction of stock prices in Indonesia after experiencing a pandemic and one year after the Corona virus. This study had been applied a dynamic ensemble method that combines various prediction models to improve forecasting accuracy. The results showed that the model has a high level of accuracy with MAPE (Mean Absolute Percentage Error) values of 0.003714125, and RMSE (Root Mean Square Error) of 0.03958605. Furthermore, these results could be used as a basis for government policy making and stock investment decisions for investors.

Impact of personality traits on stock investment decision making and the mediating effect of financial self efficacy

This purpose of this research examines the influence of personality traits on individual stock investment decision-making and tests the mediating role of financial self-efficacy between the investors' traits and their stock investment decision-making in Sri Lanka. A questionnairebased survey was conducted to collect the data from 460 registered individual investors at Colombo Stock Exchange (CSE). The regression analysis was adopted to examine the impact of personality traits on stock investment decision-making. Moreover, mediating analysis was done using sobel test. The results revealed that extraverted individual investors prefer stock investment. In contrast, the individual who possesses sympathy toward others, helpfulness, and personal warmth tend to follow others' advice, and those agreeable investors negatively impact stock investment decisions at CSE. Further, the case of financial self-efficacy fully mediates the relationship of extra version, conscientiousness, neuroticism, and openness to experience with stock investment decision making and partially mediates the relationship of agreeableness and stock investment decision making. The study has insights to investors, stockbrokers, and regulators as the crucial factors to recognize individual investors' traits and financial self-efficacy differences in making a sound investment decision.

Irrational Behaviour and Stock Investment Decision. Does Gender Matter?

The research aims to examine the influence of irrational behaviour on stock investment decision, specifically, anchoring, disposition effect, home bias, herding, overconfidence and the risk perception. The research further investigates the moderating role of gender between irrational behaviour and stock investment decision. Finally, it reveals which irrational behaviour is most prevalent. A survey collected the primary data from 425 individual investors. The survey evidence shows that, of six irrational behaviours, anchoring, disposition effect, overconfidence and risk perception were influence the investment decision of individual investors, and risk perception comes out to be the significant irrational behaviour on stock investment decision. It further explores that gender has a significant moderation for anchoring, disposition effect, herding, overconfidence, risk perception, and stock investment decision. We recommend that if individuals are aware of the behavioural biases, it will help them for making the right stock investment decisions. The study also relevant for financial advisors, stockbrokers and policymakers as it facilitates them in gaining a better understanding of their clients’ irrational behaviour. The present study gives a unique insight into the individual investors’ profile of gender corresponding to each main irrational behaviour on investment decision under consideration of stock investment.

STOCK INVESTMENT DECISION ANALYSIS ON INVESTORS IN SURABAYA

This study aims to empirically prove the impact of overconfidence, risk perception, loss aversion, and herding behavior on stock investment decisions in the city of Surabaya. The population in this research were stock investors in the city of Surabaya who found 87,702 people, with a sample of 135 people obtained through purposive sampling technique. The analysis method of this research uses Partial Least Square. According to the results of research that has already done, overconfidence has a significant positive effect on investment decisions, risk perception has a significant positive effect on investment decisions, loss aversion has no significant positive effect on investment decisions, herding behavior has a positive effect on investment decisions.

The Effect of Financial Literacy, Financial Risk Tolerance, and Financial Socialization Agents on Stock Investment Decision in The Millennial Generation

This study aim to determine financial literacy, financial risk tolerance, and financial socialization agents effect/influence on stock investment decisions in the millennial generation. The research was conducted by distributing questionnaires to 400 millennial generation stock investors in Indonesia. The data analysis method by Structural Equation Modeling (SEM) using the SmartPLS 3.2.7 program. The results show that financial literacy has a significant effect on investment decisions. Financial risk tolerance has significant effect on investment decisions, meanwhile financial socialization agents do not have a significant effect on investment decisions.