Smart investing: Unveiling key drivers of strategic investment for investors in the Indonesia Stock Exchange

Yanuarti, Ika and Cheng, Eaw Hooi and Annuar, Nursyamilah (2024) Smart investing: Unveiling key drivers of strategic investment for investors in the Indonesia Stock Exchange. Investment Management and Financial Innovations, 21 (4). pp. 156-169. ISSN 1812-9358

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Abstract

To achieve the optimal investment decision, people should have better financial lit- eracy. A better understanding of stock investment can be obtained through having experience investing in the stock market. Besides experience, influences from finan- cial socialization agents such as family, friends, education, and media will improve financial knowledge. Hence, it will determine investments wisely. The aim of this study is to determine the degree to which financial experience, family, peers, formal edu- cation, media, and financial literacy have direct on impact investment decisions and furthermore to determine the role of financial literacy as mediating variable between financial experience, family, peers, formal education, media, and investment decisions. Investors who have already registered on the Indonesia Stock Exchange are the respon- dents to this study. Only those investors are allowed to invest in the Indonesian stock market. There are 716 respondents who were analyzed using self-administered ques- tionnaires and structural equation modeling (SmartPLS). Findings show that peers and financial literacy have a direct positive impact (p<0.05) on investment decisions, while financial experience, family, education, and media do not (p>0.05). Additionally, financial experience, peers, education, and media have a significant positive effect on financial literacy (p<0.05), while family does not (p>0.05). Financial literacy is shown to mediate the relationship between financial experience, peers, education, media, and investment decisions (p<0.05) but not with family (p>0.05). This implies that having financial experience improves financial literacy, which leads to better investment deci- sions. Furthermore, peers, education, and media all play an important role in increas- ing financial literacy to make optimal investment decisions.

Item Type:	Article
Keywords:	education, experience, family, Indonesia, investment, literacy, media, peers, socialization
Subjects:	300 Social Sciences > 330 Economics > 332 Financial Economics (Shares, Investment) > 332.6 Investment 300 Social Sciences > 370 Education > 370 Education 600 Technology (Applied Sciences) > 650 Management and Public Relations > 658 General management (Risk Management, Profit and Loss, Logistics) > 658.1 Organizations > 658.15 Financial Management
Divisions:	Faculty of Business > Management
Depositing User:	Administrator UMN Library
Date Deposited:	23 May 2025 02:54
Last Modified:	23 May 2025 02:54
URI:	https://kc.umn.ac.id/id/eprint/37322

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