THE IMPACT OF BIG FIVE PERSONALITY TRAITS ON INVESTMENT DECISION MAKING AND PERCEIVED INVESTMENT PERFORMANCE IN PAKISTAN

Abstract

Purpose The research aims to study the role played by big five personality traits in the investment choices made by an individual in the specific context ofPakistan. Methodology & Design The research methods are formed considering the objectives ofthe research and ease of collection of data. Therefore, the deductive approach, explanatory study and primary sources are used to conduct this research. A sample size of 450 was selected where 384 respondents responded using convenience sampling method. In addition, the findings have mainly been reached by utilization ofquantitative data analysis tools. Findings Overall, the research has led to the findings that there is a significant impact of big five personalityfactors on individual behavior and decision making. Conversely, these affect the investment decision making and perceived investment performance in Pakistan significantly as well highlighting the importance ofpersonality in the financial markets of Pakistan. Limitations ® Small sample size of450 respondents, valid responses 384. ® Restricted to Pakistan • As researcher belonged to Karachi hence questionnaire was emailed to investors across Pakistan whereby most respondents belonged to Karachi being most proactive city in terms ofofficial investments. o Upsetting investment conditions in Pakistan restricted individual responses • Limited resources and time available to conduct the research. • As ci student, first comprehensive research was conducted. Recommendations The recommendations made in the research are illustrated below: • Investors are recommended to control their personality instincts and make investment decisions rationally. 9 Regulators are recommended to consider the personality ofindividual investors in their respective market while forming the market policies so that these policies accompany the investors' personality.