Research Article
How do Education and Investment Experience Moderate the Association Between Overconfidence and Investment Decisions?
@INPROCEEDINGS{10.4108/eai.13-9-2023.2341184, author={Syarifah Rahmawati and Nurhalis Nurhalis and Fairuzzabadi Fairuzzabadi and Evayani Evayani}, title={How do Education and Investment Experience Moderate the Association Between Overconfidence and Investment Decisions?}, proceedings={Proceedings of the 6th International Conference of Economics, Business, and Entrepreneurship, ICEBE 2023, 13-14 September 2023, Bandar Lampung, Indonesia}, publisher={EAI}, proceedings_a={ICEBE}, year={2023}, month={12}, keywords={investment decision; overconfidence; education level; investment experience; indonesian stock exchange}, doi={10.4108/eai.13-9-2023.2341184} }- Syarifah Rahmawati
Nurhalis Nurhalis
Fairuzzabadi Fairuzzabadi
Evayani Evayani
Year: 2023
How do Education and Investment Experience Moderate the Association Between Overconfidence and Investment Decisions?
ICEBE
EAI
DOI: 10.4108/eai.13-9-2023.2341184
Abstract
This study investigates how education level and investment experience moderate the association between overconfidence and investment decisions. We used a quantitative cross-sectional research design. Data was collected from 149 individual investors in the Indonesian Stock Exchange through an online questionnaire. Moderated Regression Analysis (MRA) was employed to test hypotheses. The findings emphasize that overconfidence significantly influences investment decisions, irrespective of investors’ education and investment experience. Interestingly, education’s direct impact on decisions is limited; however, it appears to enhance overconfidence, potentially leading to more irrational choices due to increased investors’ overconfidence. In contrast, investment experience acts as a buffer against investment decisions, highlighting the value of accumulated insights. Additionally, the study reveals that investment experience moderates the relationship between overconfidence and investment choices. These results align with behavioral theory, illuminating the intricate interplay of human behavior in financial decision-making. The study offers insights for policymakers and financial institutions, underlining the need for customized interventions to strengthen financial literacy and recognize the intricate interplay of experience and overconfidence biases.
