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Determinants of Financial Literacy and its Effect on Stock Market Participation among University Students in Ghana

Author

Listed:
  • Marshall Wellington Blay

    (Department of Accounting and Finance, Takoradi Technical University, Ghana)

  • Alhassan Musah

    (Department of Accounting and Finance, Takoradi Technical University, Ghana)

  • Charles Ayariga

    (Faculty of Business Studies, Takoradi Technical University, Ghana)

  • Daniel Odei Okyere

    (Department of Accounting and Finance, Takoradi Technical University, Ghana)

Abstract

The study examined determinants of financial literacy and stock market participation in Ghana. The study also examined the relationship between financial literacy and stock market participation among university students in Ghana. The study involved surveying 400 University of Ghana students to assess their level of financial literacy, stock market participation, and explore potential influencing factors. The study analysed data using ANOVA and multiple regression analysis. The findings of the study revealed that students exhibited limited knowledge in various financial literacy areas, including interest compounding, time value of money, inflation, money illusion, stocks, bonds, mutual funds, and investment risk diversification. Moreover, the study identified male, older, postgraduate students, and those with more working experience as comparatively more financially literate and active participants in stock market activities. Additionally, a positive relationship between financial literacy and stock market participation in Ghana was established. Other determinants of stock market participation included age, gender, course of study, and income levels. Based on these findings, it is recommended that the Ministry of Education implement significant initiatives to enhance financial literacy education among tertiary students. Furthermore, financial institutions should increase advertising efforts to promote awareness about various financial products.

Suggested Citation

  • Marshall Wellington Blay & Alhassan Musah & Charles Ayariga & Daniel Odei Okyere, 2024. "Determinants of Financial Literacy and its Effect on Stock Market Participation among University Students in Ghana," International Journal of Economics and Financial Issues, Econjournals, vol. 14(2), pages 15-25, March.
    • Handle: RePEc:eco:journ1:2024-02-3
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    References listed on IDEAS

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    More about this item

    Keywords

    Financial Literacy; Stock Market Participation; University Students; Ghana;
    All these keywords.

    JEL classification:

    • G20 - Financial Economics - - Financial Institutions and Services - - - General
    • G40 - Financial Economics - - Behavioral Finance - - - General
    • G41 - Financial Economics - - Behavioral Finance - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making in Financial Markets
    • G51 - Financial Economics - - Household Finance - - - Household Savings, Borrowing, Debt, and Wealth
    • G53 - Financial Economics - - Household Finance - - - Financial Literacy

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