The impact of heuristic availability bias on investment decision‐making: Moderated mediation model. Issue 3 (20th October 2020)

• Record Type: Journal Article
• Authors: Salman, Muhammad; Khan, Bakhtiar; Khan, Sher Zaman; Khan, Rafi Ullah
• Is Part Of: Business strategy and development. Volume 4:Issue 3(2021)
• Page Start: 246
• Page End: 257
• Publication Date: 2020-10-20
• Subjects: external locus of control -- heuristic availability bias -- investment decision‐making -- moderated mediation -- Pakistan stock exchange -- risk tolerance; Community development -- Periodicals; Sustainable development -- Periodicals; Social responsibility of business -- Periodicals; Economic development -- Periodicals; Social entrepreneurship -- Periodicals; 338.9
• DOI: 10.1002/bsd2.148
• Languages: English
• ISSNs: 2572-3170

Abstract

Abstract: This study tends to examine the moderated mediation role of external locus of control (ELC) and risk tolerance (RT) in the relationship between heuristic availability bias (HAB) and investment decision‐making (IDM). We used SPSS PROCESS Model 7 (moderated mediation) on a data set gleaned from 385 practicing stock investors at Pakistan Stock Exchange. The results of the study revealed that the relationship between HAB and IDM is partially mediated by RT, whereas, the ELC significantly moderates the relationship between HAB and RT. Moreover, in the case of moderated mediation, the ELC showed a significant moderating role in the relationship of HAB with IDM through RT. Since the findings of the study argue that ELC intensifies the influence of HAB on investors' risk‐taking propensity that inculcate them toward making investment decisions. The practical and theoretical implications of the study are discussed in detail.