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    Effect of Socio-demographic Factors (Age, Occupation and Education) on Behavioral Biases of Individual Investors’ Decision-making Evidence from The Colombo Stock Exchange
    (Department of Accountancy, University of Kelaniya, Sri Lanka., 2021) Gunathilaka, R. C.
    The purpose of this paper is to investigate the effect of age, occupation and education on the relationship between behavioral biases and financial decision-making of individual investors based on The Colombo Stock Exchange (CSE). This study considers overconfidence bias, representativeness bias, disposition effect and herd-mentality bias on the financial investment decision-making of individual investors, taking steps to fill the empirical gap and practice gap in Behavioral Finance context. A questionnaire was utilized to collect data and the sample consisted of 114 individual respondents. Finally, data of 100 investors was analyzed by using Partial Least Square-Structural Equation Modeling approach. The study revealed that age moderates the relationship between disposition effect and investment decisions of individual investors. Further, occupation also moderates the relationship between herd-mentality bias and individual investors’ investment decisions. This study is one of the pioneering studies examining the effect of socio-demographic factors of age, occupation and education on the relationship between behavioral biases and individual investors’ decision-making, Further, this study sheds light on the rare prior studies that relate socio-demographic factors to behavioral biases of individual investors’ decision-making, particularly in emerging markets context while expanding the extant literature in Behavioral Finance.
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    Influence of Behavioral Biases on Investment Decision Making with Moderating Role of Financial Literacy and Risk Attitude: A Study Based on Colombo Stock Exchange
    (Department of Finance, University of Kelaniya., 2022) Ranaweera, S. S.; Kawshala, B. A. H.
    Purpose: This paper aims to analyze the influence of overconfidence bias and herding bias on investment decision making and the moderating role of financial literacy and risk attitude on overconfidence bias and herding bias on investment decision making in the Colombo Stock Market. Design/Methodology/Approach: This paper collects data from a structured questionnaire survey carried out among 110 individual investors in the Colombo stock market. This paper used a multiple regression method to analyze the influence of overconfidence bias and herding bias on investment decisions with financial literacy and risk attitude as moderating variables. Findings: Overconfidence bias has a significant influence on investment decisions. Results do not indicate that herding bias significantly influence investment decisions. Financial literacy significantly moderates the relationship between overconfidence in investment decisions. However, financial literacy does not significantly moderate the relationship between herding bias in investment decisions. Financial literacy and risk attitude do not significantly moderate the relationship between herding bias in investment decisions. Implications: The findings of this paper would help to understand the influence of behavioral bias on investment decisions of individual investors in Colombo stock market. Originality/Value: The research described in this paper study the moderating role of financial literacy and risk attitude on overconfidence bias and herding bias in making investment decisions (in Colombo Stock Exchange).