Effect of Trading Companies Share on Investors Attitude and Financial Behavior

Abstract

Pakistan is under developing country and it has an unpredictable market nature of shareholder-investors observe the company’s performance. This research could help to companies in understanding financial behavior, attitude and investors’ satisfaction in stock trade. Financial behavior is comparatively new subject in Pakistan therefore; this study has examined the financial behavior and attitude of investors. The behavioral finance that has been attempt to understand the positive experiences influences investors’ financial behavior. This study has find out that investor satisfaction is strongest in influence of positive financial behavior of investor and trader in stock trading; positive experience and investors satisfaction are strengthens the investment decision of investors and increases behavior loyalty to prefer over competitor. The findings of this study has showing that investment gains results in more positive financial behavior and experience which leads investors satisfaction and preference the company over competitor. However negative financial behavior and complain induce by loss and loss also results decrease in behavior and attitudinal loyalty which leads the disappointment and regret.

Purpose – The main purpose of this study is to find factors that effects the positive experiences with stock trading on investors’ and trader’s satisfaction, attitudinal loyalty and financial behavior in Pakistan.

Design /methods and approach – The research framework links with experiences in stock trade for positive (negative) experiences, attitude and financial behavior is developed. The research framework is measured with data from sample of Karachi; the data is analyzed in smart PLS which is variance based structural equation modeling using partial least square path modeling, non-parametric software.

Research Limitation – This study is focused on trading experience with company’s active investors and traders in banking industry in Pakistan. The future research could be research in other sectors with inter-related issue of investors and traders in stock trade.

Originality/ Value – This is the first study in this research area; this study is determined the experiences with positive (negative) financial behavior, attitude and investors satisfaction of investors and traders in stock trade. Therefore adding in this area of study, which will help in understanding the investors and traders attitude and financial behavior in financial market.

Keywords – Financial Behavior, Investor satisfaction and Attitudes, Traders or Brokers and Investors Behavior, Positive and negative Experience.

Paper type – Research Paper

DOI: 10.7176/RJFA/11-12-09

Publication date:June 30th 2020