Personality Traits, Emotional Intelligence of Investors and Their Risk Tolerance

Document Type : Original Article

Authors

1 Faculty of Education and Psychology, Alzahra University, Tehran, Iran

2 Master of Psychology, Faculty of Education and Psychology, Alzahra University, Tehran, Iran

10.22034/iaas.2022.341537.1275

Abstract

Objective: There are many different investment options available in the market today and investors always prefer the investment option that fits their personality traits, risk preferences and expected returns. Risk tolerance is also affected by the personality traits and emotional intelligence of investors. Thus, the present study deals with the relationship between personality traits, emotional intelligence and risk tolerance.

Methods: The present research is a quantitative research method and the research design is correlational. This research is of descriptive-deductive type with emphasis on structural analysis and based on purpose of applied type. Data were collected from 200 stock exchange investors through an online questionnaire.

Results: The results of hypothesis testing showed that all factor loads of indicators are above 0.5 and the factor load of indicators is desirable. Based on the results obtained from the analysis of the research model, it was found that there is a positive and significant relationship between emotional intelligence and risk perception and emotional intelligence and willingness to risk. Also, a positive and significant relationship between personality traits and risk perception and risk appetite was confirmed. No evidence was found for a modulatory role of personality traits in the relationship between emotional intelligence and risk-taking.

Conclusion: The findings of the present study can be very important for investors to achieve the highest risk by knowing their personality traits and emotional intelligence.

Keywords