Investors’ Behavioural Biases and the Security Market: An Empirical Study of the Nigerian Security Market

Abiola Ayopo Babajide, Kehinde Adekunle Adetiloye

Abstract


Behavioural biases describe a replicable pattern in perceptual distortion, inaccurate judgment, illogical interpretation, or what is broadly called irrationality. This paper adopts a primary data approach to investigate the effects of behavioural biases on security market performance in Nigeria. The objectives are in twofold: one, to examine the extent of behavioural biases among security market investors in Nigeria and, to examine the effects of behavioural biases on stock market performance in Nigeria. The paper employed questionnaire as instrument and the technique of correlation with Pearson Product Moment Coefficient to analyze a survey of 300 randomly selected investors in Nigeria security market. We find strong evidence that behavioural biases exists but not so dominant in the Nigeria security market because a weak negative relationship exists between behavioural biases and stock market performance in Nigeria. The paper recommends that individual investors in the market should engage the services of investment advisors which will reduce personal biases in the management of their portfolios.


Full Text: PDF DOI: 10.5430/afr.v1n1p219

Refbacks

  • There are currently no refbacks.


Creative Commons License
This work is licensed under a Creative Commons Attribution 3.0 License.

Accounting and Finance Research
ISSN 1927-5986 (Print)   ISSN 1927-5994 (Online)

Copyright © Sciedu Press

To make sure that you can receive messages from us, please add the 'Sciedu.ca' domain to your e-mail 'safe list'. If you do not receive e-mail in your 'inbox', check your 'bulk mail' or 'junk mail' folders.