South Asian Journal of Finance

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Subject: search.filters.subject.Behavioral finance

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    Influence of Behavioral Biases on Investment Decision Making with Moderating Role of Financial Literacy and Risk Attitude: A Study Based on Colombo Stock Exchange
    (Department of Finance, University of Kelaniya., 2022) Ranaweera, S. S.; Kawshala, B. A. H.
    Purpose: This paper aims to analyze the influence of overconfidence bias and herding bias on investment decision making and the moderating role of financial literacy and risk attitude on overconfidence bias and herding bias on investment decision making in the Colombo Stock Market. Design/Methodology/Approach: This paper collects data from a structured questionnaire survey carried out among 110 individual investors in the Colombo stock market. This paper used a multiple regression method to analyze the influence of overconfidence bias and herding bias on investment decisions with financial literacy and risk attitude as moderating variables. Findings: Overconfidence bias has a significant influence on investment decisions. Results do not indicate that herding bias significantly influence investment decisions. Financial literacy significantly moderates the relationship between overconfidence in investment decisions. However, financial literacy does not significantly moderate the relationship between herding bias in investment decisions. Financial literacy and risk attitude do not significantly moderate the relationship between herding bias in investment decisions. Implications: The findings of this paper would help to understand the influence of behavioral bias on investment decisions of individual investors in Colombo stock market. Originality/Value: The research described in this paper study the moderating role of financial literacy and risk attitude on overconfidence bias and herding bias in making investment decisions (in Colombo Stock Exchange).
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    Impact of Financial Literacy Levels among Sri Lankan Investors on Investment Choices
    (Department of Finance, University of Kelaniya., 2021) Tennekoon, S. T. M. S.; Liyanage, C.
    Purpose: The purpose of this study is to investigate the level of financial literacy among Sri Lankan investors and its impact on investment choices. Design/methodology/approach: The population of this study consisted of the individual investors of Sri Lanka. Accordingly, a sample of 352 responses were obtained through a survey which was conducted using structured self-administered questionnaire. The independent variable of the research is financial literacy with the dependent variable being the investment choice. Multinomial logistic regression was used to test the hypothesis. Findings: The results of the study revealed that the majority of investors in Sri Lanka are having low objective and subjective financial literacy. Further, the results revealed that financial literacy has a statistically significant impact on the current and future choice of different investment products as the main source of investment. Originality: Financial literacy level of individual investors was assessed by using the mean value of the financial literacy score, which has not been commonly used in the Sri Lankan context. This study further contributed to the local body of literature by analyzing the investors’ current main and secondary holdings of seven different