Investigating the effect of self-control behavioral bias on financial behavior and financial well-being through the moderating role of risk aversion with the sociological approach of Iran

Document Type : Original Article

Authors

Department of Accounting, Aliabad Katoul Branch, Islamic Azad University, Aliabad Katoul, Iran.

Abstract

If capital markets are efficient, economic development will take place. On the other hand, since the country's stock market is currently very popular with investors. Undoubtedly, examining the behavioral biases of investors is of undeniable importance. Therefore, in this study, the effect of self-control behavioral bias on financial behavior and financial well-being was investigated through the moderating role of investors' risk aversion with the sociological approach of Iran. For this purpose, the statistical population consisted of individual investors, traders and brokers of Tehran Stock Exchange who were directly active in the market. Also, the statistical sample was determined using Cochran's formula of 421 people. Structural equation model using PLS method was used to analyze the data. The results showed that the self-control variable has a significant positive effect on financial behavior, financial well-being and risk aversion. This means that with increasing self-control of stock market investors, their financial behavior, financial well-being and risk aversion increase. Also, by introducing the risk aversion variable as a moderating variable, the intensity of the relationship between self-control and financial behavior increases. This means that the risk aversion of stock market investors intensifies the positive relationship between self-control and their financial behavior. Finally, by introducing the risk aversion variable as a moderating variable, the intensity of the relationship between self-control and financial well-being is reduced. This means that the risk aversion of stock market investors reduces the severity of the positive relationship between self-control and their financial well-being.

Keywords

Political Sociology of Iran
Volume 3, Issue 4 - Serial Number 12
February 2021
Pages 21-32

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