چکیده:
Objective: To date, the main source of inspiration for behavioral finance scholars has been cognitive psychology. This study builds on this tradition by merging in insights from yet another psychological sub-discipline: personality psychology. We argue that a human being’s personality is a key determinant of his/her behavior and performance. We illustrate, for a subset of five personality traits (locus of control, maximizing tendency, self-monitoring, sensation seeking and type-A/B behavior), how this logic can be applied in the context of the study of traders’ behavior and performance. Methods: we investigated the behavioral and functional components of 380 individual investors in the stock market using survey method and collecting the questionnaire. Results: The results suggested that Investors with an external locus of control, type-A behavior and high maximizing tendency are busy working on trading more frequently. Investors with an external locus of control, high sensation seeking and high self-monitoring have a less diverse portfolio. Finally, the frequency of transactions is related to better performance, while portfolio diversification does not affect the performance of the individuals. Conclusion: Different personality traits affect distinct components of trading behavior, and so trading performance.
خلاصه ماشینی:
Since human personality plays an important role in determining behavior and performance, in this research we will show how this principle can be applied in the context of studying the behavior and performance of investors for a specific subset of five personality traits (locus of control, maximization tendency, self-assessment, sensation seeking, and Type A and B behaviors).
Findings: The results show that the frequency of trading among individuals with an external locus of control, Type A behavior, and high maximization tendency is higher (they buy and sell more).
In other words, we investigate the effect that individual characteristics such as personality type, level of sensation seeking 3, locus of control 4, self-assessment 5, cognitive abilities, experience, gender, 6 have on the trading behavior and performance of real investors.
Bias, Hilton, Mazurir, and Paget (2005) examined the effect of overconfidence 4 (the tendency of individuals to have excessive confidence in their abilities and knowledge) and a personality trait called self-assessment on trading performance in an experimental asset market.
In this research, specifically five personality traits, including locus of control, excitement-seeking, maximizing benefit tendency, self-assessment, and Type A and B behaviors, were investigated.
(Refer to the image on the page) Table 4 shows the results of the effect of control variables and five personality constructs – locus of control, Type A or B behavior, maximizing tendency, sensation seeking, and self-assessment – on the dependent variable of portfolio diversification.
In general, the results of this research show that personality traits influence the trading behavior of individuals and, consequently, their investment performance.
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