IMPACT OF EMOTIONAL BIASES ON INVESTMENT PERFORMANCE OF RETAIL INVESTORS
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Abstract
Traditional theories such as the Markowitz portfolio theory and the CAPM are based on investors' risk-return calculations. Nevertheless, an investor's level of risk acceptance is determined by their traits and risk approach (Maditinos et.al., 2007). Similarly, the most traditional theory assumes investors as rational economic man.,
implying that investors consider new information while making an investment decision. However, in recent decades, behavioral finance theory has exposed investors' irrationality and demonstrated human frailty in competitive marketplaces (Waruingi, 2011).
Description
this research is to analyze the influence of emotional biases affecting retail investors' investment performance. the emotional biases influencing the investment decisions of retail investors at NEPSE. it measure the impact of emotional biases on retail investors' investment performance. IT examine the moderating role of locus of control on the relationship between emotional biases and investment performance.