| Summary: | 碩士 === 南台科技大學 === 財務金融系 === 101 === Innovation has driven the proliferation and diversification of the finance industry’s products, particularly in the international investment marketplace. The world markets have become increasingly integrated, which has led to individuals now having more flexible options for allocating their assets and managing their investments decisions. It is generally commented that home bias phenomenon exit and influence the benefits of diversifying their portfolio. In this study, we consider how behavioral biases can make it more difficult to predict the rationality of individual investing behavior, especially focusing on the effect of home bias, overconfidence, and mental accounting on investment decisions. The application of consumer buying behavior frameworks, such as those by Engel, Kollat and Blackwell Theory (1978), facilitates the understanding of the psychological influence on decision-making in various stages.
This study of the psychological biases influencing individual investment decisions according to home bias, overconfidence, and mental accounting selected UK experienced investors in the financial market. A survey approach was used for the primary data collected from questionnaires and regression analysis validated the relationship between decision-making and psychological biases since it is proper to evaluate complex social sciences. The statistics demonstrate that the relationship between behavioral biases and the investment decision-making. The UK investor’s decision-making process follows a rational pattern to consider a foreign investment. The investment decisions entail a particular mental account based on the difference between financial goals has positive influence on three stages. Therefore, the irrational investment behavioral biases which home bias occurs in second stage of searching information frequently. The implications are then discussed. This could be used to make sensible suggestions for finical marketer selecting targeted group. Furthermore, the results can be valuable for individual investors recognizing opportunities and making portfolio choices, and marketers needing to design appropriate marketing strategies according to consumers’ psychological considerations; thereby enabling them to communicate effectively.
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