Individual investor behavior and the impact of behavioral biases on the Moroccan stock market

  • Ayoub MASSIKI Faculty of Economics and Management, Ibn Tofail University of Kenitra, Morocco
  • Omar KHARBOUCH Faculty of Economics and Management, Ibn Tofail University of Kenitra, Morocco
  • Nabil DAHHOU Faculty of Economics and Management, Ibn Tofail University of Kenitra, Morocco
  • Olaya METWALLI Faculty of Economics and Management of Settat, Université Hassan Premier, Settat, Maroc

Abstract

The investment process requires investors to make different types of decisions, and the quality of these decisions determines the outcome of the investment process. Standard finance and behavioral finance theories present different views of investment decision-making, based on the concept of rationality. Behavioral finance theories indicate that investors do not act totally rationally when making investment decisions, due to various biases. The aim of the study is to identify the factors based on behavioral finance that influence investors' investment decisions in the Moroccan stock market. For this, the questionnaires were sent directly to individual investors. They were chosen at random. 300 questionnaires sent to retail investors; our sample is therefore 112 investors who responded to complete responses. The analytical tools of exploratory factor analysis and confirmatory factor analysis were used to analyze the data, based on a positivist epistemological stance. According to the results of the study, there are five behavioral factors that influence the investment decisions of individual investors. Users can use this information to better understand investors' motivations, and thus offer them investment opportunities better suited to their needs.

 

Keywords: Individual investors, stock market, behavioral biases, investor performance, behavioral finance. Classification JEL: G11, G40,G41

Paper type : Empirical research.



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Author Biographies

Ayoub MASSIKI, Faculty of Economics and Management, Ibn Tofail University of Kenitra, Morocco

Laboratoire LEMO

Omar KHARBOUCH, Faculty of Economics and Management, Ibn Tofail University of Kenitra, Morocco

Laboratoire LEMO

Nabil DAHHOU, Faculty of Economics and Management, Ibn Tofail University of Kenitra, Morocco

Laboratoire LEMO

Published
2023-08-24
How to Cite
MASSIKI, A., KHARBOUCH, O., DAHHOU, N., & METWALLI, O. (2023). Individual investor behavior and the impact of behavioral biases on the Moroccan stock market. International Journal of Accounting, Finance, Auditing, Management and Economics, 4(4-2), 302-318. https://doi.org/10.5281/zenodo.8279891