THE EMPIRICAL STUDY ON THE INFLUENCE OF INVESTORS’ DEMOGRAPHIC FEATURES AND PERSONALITY TRAITS TOWARDS STOCK PREFERENCE
Thesis
Proposed To Master Of Management Post Graduate Program
To Obtain The Master Of Management Degree
By
Ruth Widyasari 912011036
Master of Management Study Program Postgraduate Program
Satya Wacana Christian University Salatiga
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ABSTRACT
This study aimed to find out what demographic factors and the Big-Five Personality Traits, which influenced the investors’ stock preference. Seventy six investors from various demographic
backgrounds were involved in this Study. It was found that
demographic factors, such as age, gender and education did not
influence the investors in making the decision of purchasing value
or growth stocks. The Big-Five Personality Traits employed to see
whether certain types of personality influenced the stock preference.
Personality traits, which influence the investors’ stock preference were extraversion and openness to experience. While, neuroticism
and conscientiousness did not influence the stock preference.
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PREFACE
This thesis consists of five chapters. The first chapter
focuses on the background idea and the problem related to what demographic factors and personality traits, which might influence the stock preference. The second chapter discusses the literature and develops the hypotheses. In the second chapter, stock preference, investors’ characteristics based on stock preference, factors that influence stock preference are elaborated to develop the hypotheses. Then, chapter three explains the methods used in this study. The forth chapter elaborates the result of the study. At the final, chapter five conclude the overall study and point out the limitation, so there would be improvement for future studies.
The writer hopes that this thesis would be very useful for the future studies and is able to complete the reference in finance.
Salatiga, 16 January 2014
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ACKNOWLEDGEMENT
In completing this thesis, the writer did not work alone. From the beginning until it has finished, some important people helped the writer. Those people gave the writer supports, guidance, even prayers when the writer wrote the thesis and did the research. Therefore, in this page, the writer would like to express the special gratitude for those special people.
First of all, I’m willing to express my gratitude to the advisor, Prof. Supramono, SE., MBA., DBA, who always patiently gave the writer guidance in writing this thesis and doing the research and support my study from the beginning until the writer could finish it. Thank you for the advice and strength so that the writer could write this thesis.
My deepest gratitude goes to my lovely husband, mom, dad, and brother for their endless support in my whole life. Nothing compares their loves for me. Especially for my husband, thanks for your patience and love, for my mom for your prayer everyday in my whole life.
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The last but not the least, all of my friends, Kak Stany, Lia, Kak Betty, Kak Herfin, Kak Welly and all the students of MM UKSW thank you so much of being my best friends both in class and outside the class. My special thanks are for my partners in crime, Mas Anggit, Ruth Meike, Mas Izoel, Dita Pinasti, Manda, and Rimpenk. Thank you for being such wonderful persons for me.
The writer’s best gratitude is for those who have been
mentioned above. Without those people, the writer could not finish this thesis in this semester. The contribution of those people to this thesis is very precious for the writer. Finally,
“May He give you the desire of your heart and make all your
plans succeed.” (Psalm 20:4) God have given the writer success
in completing this thesis and hopefully He also give all of people who helped the writer success in their life. Thank you.
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Table of Content
CONTENTS Page
TITLE PAGE……….……i
APPROVAL PAGES………...……ii
STATEMENT OF WORK’S ORIGINALITY……….……iii
ABTRACT………...iv
PREFACE……….…...v
ACKNOWLEDGEMENT……….….vi
TABLE OF CONTENTS……….………….…..viii
LIST OF TABLES………..…x
LIST OF APPENDICES………...xi
CHAPTER I. INTRODUCTION1 A. Background of the Study………...………..1
B. Problem Formulations…………..…..………..…6
C. Purpose of the Study………..………6
D. Significance of the Study………..…6
CHAPTER II. REVIEW OF RELATED LITERATURE AND HYPOTHESIS DEVELOPMENT A. Stocks Preferences………..…..……….….8
B. Investors’ Characteristics Based on the Stock Preference……….………..………11
C. Factors that Influence Stock Preference…………..….13
1) The Demographic Features………..….13
2) The Big Five Personality Traits……….15
CHAPTER III. METHODS A. Population and Sample Selection………..….20
B. Measurement……….………24
C. Data Collection………..………27
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CHAPTER IV. RESULT AND DISCUSSION
A. RESULT……….……….…..30
1. Descriptive Statistics………..……….…..…..30
2. Goodness of Fit..………..…..35
3. Hypotheses Testing……….………..…..…..37
B. DISCUSSION……….………….41
CHAPTER V. CONCLUSIONS AND IMPLICATIONS A. Conclusions……….………...48
B. Theoretical Implications……….…….49
C. Applied Implications………....50
D. Limitations & Recommendations For Future Research ……….….51
REFERENCES….………54
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LIST OF TABLES
Table page
2.1 The Characteristics of Growth Stocks and Value Stocks………11
2.2 Description of Big five Personality Traits……….15 3.1 Respondents’ Characteristics………..………...21 3.2 Respondents’ Related Information of Stock Investment……....22 3.3 Concepts and Indicators………..………....25 3.4 The Validity of the Instruments……….……….26 3.5 The Reliability of the Instruments………..…………..…….27
4.1 Descriptive Statistics of Respondents’ Big Five Personality Types………...………..………..32 4.2 Descriptive Statistics of The Stock Preference………….………..34 4.3 The Stock Preference Distribution……….…………35
4.4 Regressions of Stock Preference on Demographic and
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LIST OF APPENDICES
Page Appendix 1 : Questionnaire……….60 Appendix 2 : Respondents’ Characteristics ………..64 Appendix 3 : Respondents’ Related Information on Stock
Investment…...………..…………66 Appendix 4 : The Respondents’ Answers on Personality Traits ….67 Appendix 5 : The Respondents’ Answers on Stock Preference …...70 Appendix 6 : Validity of the Instruments ………..72 Appendix 7 : Reliability of the Instruments ………..73 Appendix 8 : The Distribution of Stock Preference………..74 Appendix 9 : The Cross Tabulation of Gender and Education
towards Stock Preference………..……75
Appendix 10 : Goodness of Fit……….…………....76 Appendix 11 : Regression of Stock Preference on Demographic and
