Work

Examining the mediating role of risk aversion and the moderating role of demographics in the relationship between personality traits and investment decisions

Year: 2025

Type: article

Abstract: This study intends to examine how personality factors affect people's risk-aversion behavior and investment intentions, as well as how risk aversion mediates the link between personality traits and investment intentions, and how gender acts as a moderator. Individuals have five different personality qualities in this study, which are openness to experience, conscientiousness, extraversion, agreeableness, and neuroticism, while short-term and long-term investment intents are employed as investment intentions. The data is gathered from 750 participants (students) with backgrounds in business and finance. The PLS-SEM method is used in the study to conduct the analysis of the data. The results support that investment intentions both short-term and long-term are positively associated with openness to experience, agreeableness, and conscientiousness. Long-term investment, however, is inversely correlated with neuroticism and risk aversion and positively correlated with extraversion. The relationship between extraversion and short-term investment intentions is fully mediated by risk aversion behavior, whereas the relationship between agreeableness and long-term investment intentions has no mediating effect. The study also discovers the partial mediation effect of risk aversion on the relationship between personality traits and investment intentions. The findings also showed that gender significantly moderates two relationships: the association between conscientiousness and long-term intentions and the relationship between openness to experience.

Source: Acta Psychologica

DOI: 10.1016/j.actpsy.2025.105411

Authors: Kanwal Haqqani, Muhammad Aleem, Shahid Mahmood, Asifa Iqbal, El-Sayed M. El-kenawy, Amal H. Alharbi