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The Impact of Personality Traitson Investment Decision Making :

An Empirical Study

Purvi Paarakh

Master Of Business Administration,

Amity Business School

Amity University, Chhattisgarh, India

ABSRACT

Financial planning is essential for managing rising living costs and achieving desired living standards.

Investments play a crucial role in individuals’ financial well-being. Individuals base their investment decisions on factors such as personal suitability, risk tolerance, and expected returns; however, these decisions are not always entirely rational. Given the dynamic nature of individual investors, it is necessary to consider psychological influences on financial decision-making. This dissertation examines how consumer sociodemographic characteristics influence variations in the Big Five personality traits (neuroticism, extraversion, agreeableness, conscientiousness, and openness to experience). It further investigates how these personality traits affect investment behavior and explores the impact of financial literacy on investment decisions, with a particular focus on the mediating role of personality traits in this relationship. By addressing these dimensions, the study aims to deepen the understanding of behavioral factors in investment decision-making.

Keywords:
Investment Decision-Making, Financial Literacy, Personality Traits, Big Five Model, Behavioral Finance, Risk Tolerance, Sociodemographic Factors, Investor Psychology, Conscientiousness, Neuroticism, Extraversion, Agreeableness, Openness to Experience, Mediating Role, Financial Planning