IMPACT OF PERSONALITY TRAITS ON STOCK MARKET INVESTORS WITH REGARD TO RISK TOLERANCE

Abstract

The study examines the impact of personality traits on investment decisions based on the big-five model. A total of 100 responses from Cochin were collected using the convenience sampling technique. The five-point Likert scale questionnaire was used alongside the Smart-PLS software for data analysis. The results suggest that personality traits did have a significant effect on investment decisions through agreeableness, conscientiousness and extraversion. However, risk tolerance has a significant negative impact on investment decisions through openness to experience and a significant positive impact through neuroticism. The study helps improve our understanding of investor behaviour by considering the mediating role of big five personality traits on the relationship between risk tolerance and investment decisions. It is recommended that financial institutions should provide investment counselling services to prospective investors using the consumer profile technique.