Investors' intrinsic motives and decision-making in the stock market

Abstract

Purpose. Over the past century, the stock market has become an ideal investment option for investors by pooling the needs of people with similar financial aspirations. This study explores the various variables of investment objectives and decision-making that motivate stock market participants based on the inherent motivations of Nepalese investors. This study examined individual investors' reasons for investing regarding investment horizons, information and analysis, gender, age, academic qualifications, and stock market experience.
Design/methodology/approach. This study includes administering a structured, closed-ended questionnaire to 405 investors in the stock market. This study uses an exploratory and causal-comparative approach to identify three primary investment motives: transactional, precautionary, and speculative.
Findings. The regression analysis revealed that only speculative and transactional motives significantly impact stock market investment decisions (p < 0.05), emphasizing the unique nature of investor motivations. As there is no significant relationship found between precautionary motives and investment decisions (p > 0.05), it urges caution and highlights the need for informed decision-making. ANOVA tests further highlight the findings, emphasizing the significance of investors' experiences while rendering demographic factors such as gender, age, education, or formal training irrelevant in stock market decision-making.
Research limitations/implications. This study implies that investors' motives drive their investment decisions, regardless of their background. The high value of investment experience underlines the importance of practical exposure in investor decisions.
Originality/value. This study uniquely reveals that speculative and transactional motives, rather than demographic factors, drive investment decisions among Nepalese investors. Employing an exploratory and causal-comparative approach, it underscores the critical role of investment experience. These findings offer new insights, emphasizing the need for regulatory agencies and market-listed companies to enhance awareness and provide tailored investment options.