Role of Loss Aversion, Representativeness, and Overconfidence in Investment Decision-Making
Year: 2025
Type: article
Study design: Observational Study
Abstract: This study investigates how behavioral biases loss aversion, representativeness, and overconfidence influence investment decisions in Nepal’s stock market. Using a descriptive and causal research design, data were collected via structured questionnaires from 120 individual investors. Analysis through SPSS revealed that overconfidence has a significant positive impact on investment decisions, while loss aversion and representativeness showed moderate but insignificant effects. These findings highlight the critical role of psychological factors in shaping investor behavior, offering insights for financial advisors and policymakers to mitigate bias-driven risks.
Authors: Sajeeb Kumar Shrestha, Pravesh Karki, Nayan Shrestha, Tej Bahadur Karki, Dipak Mahat, Dasarath Neupane
Institution: Tribhuvan University
Language: English
Subfield: Finance
Domain: Social Sciences
Open Access status: diamond
OpenAlex ID: W4408203687