IDEAS home Printed from https://ideas.repec.org/a/taf/oaefxx/v3y2015i1p1057923.html
   My bibliography  Save this article

The factors forming investor’s failure: Is financial literacy a matter? Viewing test by cognitive mapping technique

Author

Listed:
  • Amari Mouna
  • Jarboui Anis
  • David McMillan

Abstract

The objective of this paper is to apply cognitive map-related techniques to extract causal knowledge from a specific problem domain. This paper proposes to draw an average cognitive map in order to identify the failure factors of the Tunisian small investors. Our paper extends traditional and behavioral finance and previous research by proposing a new approach to building an average cognitive map for the explanation of small investors’ failure in the stock market.

Suggested Citation

  • Amari Mouna & Jarboui Anis & David McMillan, 2015. "The factors forming investor’s failure: Is financial literacy a matter? Viewing test by cognitive mapping technique," Cogent Economics & Finance, Taylor & Francis Journals, vol. 3(1), pages 1057923-105, December.
    • Handle: RePEc:taf:oaefxx:v:3:y:2015:i:1:p:1057923
    DOI: 10.1080/23322039.2015.1057923
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1080/23322039.2015.1057923
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1080/23322039.2015.1057923?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Chip Heath & Steven Huddart & Mark Lang, 1999. "Psychological Factors and Stock Option Exercise," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 114(2), pages 601-627.
    2. Beshears, John & Choi, James J. & Laibson, David & Madrian, Brigitte C., 2008. "How are preferences revealed?," Journal of Public Economics, Elsevier, vol. 92(8-9), pages 1787-1794, August.
    3. Andreas Park & Hamid Sabourian, 2011. "Herding and Contrarian Behavior in Financial Markets," Econometrica, Econometric Society, vol. 79(4), pages 973-1026, July.
    4. Kaustia, Markku & Torstila, Sami, 2011. "Stock market aversion? Political preferences and stock market participation," Journal of Financial Economics, Elsevier, vol. 100(1), pages 98-112, April.
    5. Anis Omri & Mohamed Frikha, 2014. "How small business fail in Tunisia?," International Journal of Economics and Accounting, Inderscience Enterprises Ltd, vol. 5(2), pages 126-144.
    6. Daniel Kahneman & Amos Tversky, 2013. "Prospect Theory: An Analysis of Decision Under Risk," World Scientific Book Chapters, in: Leonard C MacLean & William T Ziemba (ed.), HANDBOOK OF THE FUNDAMENTALS OF FINANCIAL DECISION MAKING Part I, chapter 6, pages 99-127, World Scientific Publishing Co. Pte. Ltd..
    7. Furnham, Adrian & Boo, Hua Chu, 2011. "A literature review of the anchoring effect," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 40(1), pages 35-42, February.
    8. Scholnick, Barry & Massoud, Nadia & Saunders, Anthony, 2013. "The impact of wealth on financial mistakes: Evidence from credit card non-payment," Journal of Financial Stability, Elsevier, vol. 9(1), pages 26-37.
    9. Taylor, Mark P. & Jenkins, Stephen P. & Sacker, Amanda, 2011. "Financial capability and psychological health," Journal of Economic Psychology, Elsevier, vol. 32(5), pages 710-723.
    10. Fama, Eugene F, 1970. "Efficient Capital Markets: A Review of Theory and Empirical Work," Journal of Finance, American Finance Association, vol. 25(2), pages 383-417, May.
    11. Shefrin, Hersh & Statman, Meir, 2000. "Behavioral Portfolio Theory," Journal of Financial and Quantitative Analysis, Cambridge University Press, vol. 35(2), pages 127-151, June.
    12. Robert J. Shiller, 2003. "From Efficient Markets Theory to Behavioral Finance," Journal of Economic Perspectives, American Economic Association, vol. 17(1), pages 83-104, Winter.
    13. Campbell, Sean D. & Sharpe, Steven A., 2009. "Anchoring Bias in Consensus Forecasts and Its Effect on Market Prices," Journal of Financial and Quantitative Analysis, Cambridge University Press, vol. 44(2), pages 369-390, April.
    14. Brad M. Barber & Terrance Odean, 2001. "Boys will be Boys: Gender, Overconfidence, and Common Stock Investment," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 116(1), pages 261-292.
    15. Beshears, John & Choi, James J. & Laibson, David & Madrian, Brigitte C., 2008. "How are preferences revealed?," Journal of Public Economics, Elsevier, vol. 92(8-9), pages 1787-1794, August.
    16. Sonya Seongyeon Lim, 2006. "Do Investors Integrate Losses and Segregate Gains? Mental Accounting and Investor Trading Decisions," The Journal of Business, University of Chicago Press, vol. 79(5), pages 2539-2574, September.
    17. Bay, Charlotta, 2011. "Framing financial responsibility: An analysis of the limitations of accounting," CRITICAL PERSPECTIVES ON ACCOUNTING, Elsevier, vol. 22(6), pages 593-607.
    18. Gulnur Muradoglu & Nigel Harvey, 2012. "Behavioural finance: the role of psychological factors in financial decisions," Review of Behavioral Finance, Emerald Group Publishing Limited, vol. 4(2), pages 68-80, November.
    19. Altman, Morris, 2012. "Implications of behavioural economics for financial literacy and public policy," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 41(5), pages 677-690.
    20. Alok Kumar & Charles M.C. Lee, 2006. "Retail Investor Sentiment and Return Comovements," Journal of Finance, American Finance Association, vol. 61(5), pages 2451-2486, October.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. repec:gei:journl:v:2:y:2017:i:2:p:145-164 is not listed on IDEAS
    2. Muhammad Anwar, Sher Zaman Khan, Amin Ur Rehman, 2017. "Financial Literacy, Behavioral Biases and Investor's Portfolio Diversification: Empirical Study of an Emerging Stock Market," Journal of Finance and Economics Research, Geist Science, Iqra University, Faculty of Business Administration, vol. 2(2), pages 144-163, October.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Víctor Alberto Pena & Alina Gómez-Mejía, 2019. "Effect of the anchoring and adjustment heuristic and optimism bias in stock market forecasts," Revista Finanzas y Politica Economica, Universidad Católica de Colombia, vol. 11(2), pages 389-409, November.
    2. Tai-Yuen Hon & Massoud Moslehpour & Kai-Yin Woo, 2021. "Review on Behavioral Finance with Empirical Evidence," Advances in Decision Sciences, Asia University, Taiwan, vol. 25(4), pages 15-41, December.
    3. Martin Gold, 2010. "Fiduciary Finance," Books, Edward Elgar Publishing, number 13813.
    4. Jasman Tuyon & Zamri Ahmada, 2016. "Behavioural finance perspectives on Malaysian stock market efficiency," Borsa Istanbul Review, Research and Business Development Department, Borsa Istanbul, vol. 16(1), pages 43-61, March.
    5. Ashutosh Pradhan, 2021. "Quantitative model for impact of behavioral biases on asset allocation decisions: a case study of investors in UAE," Journal of Asset Management, Palgrave Macmillan, vol. 22(7), pages 573-580, December.
    6. Wasim ul Rehman & Omur Saltik & Faryal Jalil & Suleyman Degirmen, 2024. "Viral decisions: unmasking the impact of COVID-19 info and behavioral quirks on investment choices," Palgrave Communications, Palgrave Macmillan, vol. 11(1), pages 1-20, December.
    7. Ahmed Hamed Al-Abbadi & Adam Abdullah, 2017. "Modeling Psychology in Islamic Wealth Management," International Journal of Economics and Finance, Canadian Center of Science and Education, vol. 9(10), pages 64-85, October.
    8. Pereira Reichhardt, Joaquín & Iqbal, Tabassum, 2014. "Investment Decisions: Are we fully-Rational?," MPRA Paper 57686, University Library of Munich, Germany.
    9. Bouteska, Ahmed & Kabir Hassan, M. & Gider, Zeynullah & Bataineh, Hassan, 2024. "The role of investor sentiment and market belief in forecasting V-shaped disposition effect: Evidence from a Bayesian learning process with DSSW model," The North American Journal of Economics and Finance, Elsevier, vol. 71(C).
    10. Yogita Singh & Mohd. Adil & S. M. Imamul Haque, 2023. "Personality traits and behaviour biases: the moderating role of risk-tolerance," Quality & Quantity: International Journal of Methodology, Springer, vol. 57(4), pages 3549-3573, August.
    11. Doron Avramov & Guy Kaplanski & Avanidhar Subrahmanyam, 2022. "Postfundamentals Price Drift in Capital Markets: A Regression Regularization Perspective," Management Science, INFORMS, vol. 68(10), pages 7658-7681, October.
    12. Anna Blajer-Gołębiewska, 2021. "Individual corporate reputation and perception of collective corporate reputation regarding stock market investments," PLOS ONE, Public Library of Science, vol. 16(9), pages 1-21, September.
    13. Mai, Nhat Chi, 2016. "The Influence Of Macroeconomic Announcements Into Vietnamese Stock Market Volatility," OSF Preprints ydmhx, Center for Open Science.
    14. Hajdu, Tamás & Hajdu, Gábor, 2011. "A hasznosság és a relatív jövedelem kapcsolatának vizsgálata magyar adatok segítségével [Examining the relation of utility and relative income using Hungarian data]," Közgazdasági Szemle (Economic Review - monthly of the Hungarian Academy of Sciences), Közgazdasági Szemle Alapítvány (Economic Review Foundation), vol. 0(1), pages 56-73.
    15. Yildiz, Özgür, 2014. "Lehren aus der Verhaltensökonomik für die Gestaltung umweltpolitischer Maßnahmen [Lessons from behavioral economics for the design of environmental policy measures]," MPRA Paper 59360, University Library of Munich, Germany.
    16. Kuo-Hwa Chang & Michael Nayat Young, 2019. "Portfolios Optimizations of Behavioral Stocks with Perception Probability Weightings," Annals of Economics and Finance, Society for AEF, vol. 20(2), pages 817-845, November.
    17. Andrea Lippi & Laura Barbieri & Mariacristina Piva & Werner De Bondt, 2018. "Time-varying risk behavior and prior investment outcomes: Evidence from Italy," Judgment and Decision Making, Society for Judgment and Decision Making, vol. 13(5), pages 471-483, September.
    18. Mirjam Lehenkari & Jukka Perttunen, 2010. "Holding on to the Losers: Finnish Evidence," Chapters, in: Brian Bruce (ed.), Handbook of Behavioral Finance, chapter 17, Edward Elgar Publishing.
    19. Wen-Jun Xue & Li-Wen Zhang, 2016. "Stock Return Autocorrelations and Predictability in the Chinese Stock Market: Evidence from Threshold Quantile Autoregressive Models," Working Papers 1605, Florida International University, Department of Economics.
    20. Nathan Berg & Gerd Gigerenzer, 2010. "As-if behavioral economics: neoclassical economics in disguise?," History of Economic Ideas, Fabrizio Serra Editore, Pisa - Roma, vol. 18(1), pages 133-166.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:taf:oaefxx:v:3:y:2015:i:1:p:1057923. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chris Longhurst (email available below). General contact details of provider: http://www.tandfonline.com/OAEF20 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.