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Perceived Risk, Investment Performance and Intentions in Emerging Stock Markets

Author

Listed:
  • Phung Thai Minh Trang

    (Department of Accounting and Finance, Faculty of Economics and Commerce, Hoa Sen University, Ho Chi Minh City, Vietnam,)

  • Nguyen Huu Tho

    (Department of Finance-Project, Faculty of Business Administration, University of Economics, Ho Chi Minh City, Vietnam.)

Abstract

The study built the new measurement scales of risk perception in investing in stock types trading on the emerging stock market, and then explored the effects of perceived risk on investment performance and intentions of individual investors. The study employed mixed research methods including in-depth interviews, a pilot study involving 50 investors, a survey distributed to 465 retail investors. Results showed that perceived risk had the direct positive impact on both investment performance and intentions. Perceived risk also had the indirect influence on intentions to invest through investment performance. For managerial decisions, investors are recommended to draw attention to the risks of investing in stocks labelled as warned , controlled , and halted trading . The higher investors perceive the risks of these stock types, the greater they are satisfied with their investment decisions, the recent rate of return achieved, and the more they intend to invest in the next time. Securities corporations have regularly organized seminars, workshops or training courses about investing in the kinds of stocks, updated regulations of stock investment in time, and improved the quality of listed companies to attract more investors to the stock market.

Suggested Citation

  • Phung Thai Minh Trang & Nguyen Huu Tho, 2017. "Perceived Risk, Investment Performance and Intentions in Emerging Stock Markets," International Journal of Economics and Financial Issues, Econjournals, vol. 7(1), pages 269-278.
    • Handle: RePEc:eco:journ1:2017-01-35
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    References listed on IDEAS

    as
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    3. Nicholas Barberis & Ming Huang, 2001. "Mental Accounting, Loss Aversion, and Individual Stock Returns," NBER Working Papers 8190, National Bureau of Economic Research, Inc.
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    Cited by:

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    2. Syed Aliya Zahera & Rohit Bansal, 2018. "Do investors exhibit behavioral biases in investment decision making? A systematic review," Qualitative Research in Financial Markets, Emerald Group Publishing Limited, vol. 10(2), pages 210-251, May.
    3. Sanmugam Annamalah & Murali Raman & Govindan Marthandan & Aravindan Kalisri Logeswaran, 2019. "An Empirical Study on the Determinants of an Investor’s Decision in Unit Trust Investment," Economies, MDPI, vol. 7(3), pages 1-23, August.
    4. Nur Alya Afiqah Binti Mahat & Wei-Theng Lau, 2023. "Financial Literacy, Experience, Risk Tolerance and Investment Behavior: Observations during Pandemic," International Journal of Research and Innovation in Social Science, International Journal of Research and Innovation in Social Science (IJRISS), vol. 7(10), pages 558-573, October.
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    More about this item

    Keywords

    Investment Performance; Intentions; Perceived Risk; Emerging Stock Markets;
    All these keywords.

    JEL classification:

    • E44 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Financial Markets and the Macroeconomy
    • G31 - Financial Economics - - Corporate Finance and Governance - - - Capital Budgeting; Fixed Investment and Inventory Studies

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