A study of institutional investors' behavioral biases Vietnamese stock market
Abstract
Investors are not always to make decision rationally. They can be affected by psychological factors including emotional and cognitive factors as so-called behavioral biases in their decision-making process.
The purpose of this research is to determine investor’s behavioral biases in Vietnamese stock market, to compare the percentage of behavioral biases appearing to between institutional investors and individual investors in Vietnam.
I apply the quantitative method for this research. The survey is carried out in
the form of questionnaire. The objects of this research are institutional investors who have knowledge in finance and make decision by themselves after studying carefully.
The research is conducted to survey 20 behavioral biases of institutional investors. The research results describe some behavioral biases appearing with high percentage, especially such as Ambiguity aversion bias (77%), Recency bias (63%), Regret aversion bias (62%), Status quo bias (60%), Overconfidence bias (47%), Self- control bias (47%), Anchoring bias (43%), Confirmation bias (43%), Endowment effect (41%), Framing bias (41%), Mental accounting bias (40%), Conservatism bias (39%), Illusion of control bias (38%), Cognitive dissonance bias (37%), Loss aversion bias (35%).
Besides, there are other behavioral biases such as Hindsight bias (22%), Optimism bias (17%), Representative bias (17%), Self-attribution bias (16%),
Availability bias (14%).