Hamid, Fazelina Sahul and Rangel, Gary John and M. Taib, Fauziah and Thurasamy, Ramayah (2013) The Relationship between Risk Propensity, Risk Perception and Risk-Taking Behaviour in an Emerging Market. The International Journal of Banking and Finance, 10 (1). pp. 134-146. ISSN 1617-722

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Abstract

This paper reports evidence to support a relationship between risk propensity, risk perception, and risk-taking behaviour of investors in an emerging market. Primary data were gathered using a validated structured questionnaire, which was self-administered by respondents: there were 162 investors from 8 stockbroking companies. A multiple regression was used to test the direct and indirect effects of the identified behavioural characteristics on investment decision. Risk propensity was found to be positively related to risk-taking behaviour whereas risk perception was negatively related to risk-taking behaviour.It was further found that risk perception partially mediates the effect of propensity to take risk. This suggests that the perceptual framing of a situational context in the investors’ thought processes reduces but it does not totally overwhelm the innate personality traits with respect to either the investor’s risk-seeking or risk-averseness. The tendency to engage in risky behaviour is more psychological in nature. The implications of the research are further explored.

Item Type:	Article
Uncontrolled Keywords:	Risk propensity, Risk perception, Risk-taking behaviour, Empirical study
Subjects:	H Social Sciences > HG Finance
Divisions:	UUM Press
Depositing User:	Mrs. Norazmilah Yaakub
Date Deposited:	25 Oct 2018 00:19
Last Modified:	25 Oct 2018 00:19
URI:	https://repo.uum.edu.my/id/eprint/24991

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