Institutional Repository | Satya Wacana Christian University: The Empirical Study on the Influence of Investors' Demographic Features and Personality Traits Towards Stock Preference
THE EMPIRICAL STUDY ON THE INFLUENCE OF
INVESTORS’ DEMOGRAPHIC FEATURES AND
PERSONALITY TRAITS TOWARDS STOCK PREFERENCE
Thesis
Proposed To Master Of Management Post Graduate Program
To Obtain The Master Of Management Degree
By
Ruth Widyasari
912011036
Master of Management Study Program
Postgraduate Program
Satya Wacana Christian University
Salatiga
2014
ii
iii
ABSTRACT
This study aimed to find out what demographic factors and
the Big-Five Personality Traits, which influenced the investors’ stock
preference.
Seventy
six
investors
from
various
demographic
backgrounds were involved in this Study. It was found that
demographic factors, such as age, gender and education did not
influence the investors in making the decision of purchasing value
or growth stocks. The Big-Five Personality Traits employed to see
whether certain types of personality influenced the stock preference.
Personality traits, which influence the investors’ stock preference
were extraversion and openness to experience. While, neuroticism
and conscientiousness did not influence the stock preference.
Keywords: demographic factors, personality traits, stock preference
iv
PREFACE
This thesis consists of five chapters. The first chapter
focuses on the background idea and the problem related to
what demographic factors and personality traits, which might
influence the stock preference. The second chapter discusses
the literature and develops the hypotheses. In the second
chapter, stock preference, investors’ characteristics based on
stock preference, factors that influence stock preference are
elaborated to develop the hypotheses. Then, chapter three
explains the methods used in this study. The forth chapter
elaborates the result of the study. At the final, chapter five
conclude the overall study and point out the limitation, so
there would be improvement for future studies.
The writer hopes that this thesis would be very useful for
the future studies and is able to complete the reference in
finance.
Salatiga, 16 January 2014
Ruth Widyasari
v
ACKNOWLEDGEMENT
In completing this thesis, the writer did not work alone.
From the beginning until it has finished, some important
people helped the writer. Those people gave the writer
supports, guidance, even prayers when the writer wrote the
thesis and did the research. Therefore, in this page, the writer
would like to express the special gratitude for those special
people.
First of all, I’m willing to express my gratitude to the
advisor, Prof. Supramono, SE., MBA., DBA, who always
patiently gave the writer guidance in writing this thesis and
doing the research and support my study from the beginning
until the writer could finish it. Thank you for the advice and
strength so that the writer could write this thesis.
My deepest gratitude goes to my lovely husband,
mom, dad, and brother for their endless support in my whole
life. Nothing compares their loves for me. Especially for my
husband, thanks for your patience and love, for my mom for
your prayer everyday in my whole life.
My special thanks go to all investors involved in my
study, the Manager of Reksadana, Mas Rendy and and Cik
Lingling from PT. Trimegah, who has kindly helped me in doing
the research. My best gratitude also goes to all of the lecturers
in Master of Management Satya Wacana chritian Univesity and
also Mbak Ira, I know that without them I cannot finish this
study as well.
vi
The last but not the least, all of my friends, Kak Stany,
Lia, Kak Betty, Kak Herfin, Kak Welly and all the students of
MM UKSW thank you so much of being my best friends both in
class and outside the class. My special thanks are for my
partners in crime, Mas Anggit, Ruth Meike, Mas Izoel, Dita
Pinasti, Manda, and Rimpenk. Thank you for being such
wonderful persons for me.
The writer’s best gratitude is for those who have been
mentioned above. Without those people, the writer could not
finish this thesis in this semester. The contribution of those
people to this thesis is very precious for the writer. Finally,
“May He give you the desire of your heart and make all your
plans succeed.” (Psalm 20:4) God have given the writer success
in completing this thesis and hopefully He also give all of
people who helped the writer success in their life. Thank you.
Ruth Widyasari
vii
Table of Content
CONTENTS
Page
TITLE PAGE………………………………………………………………….……i
APPROVAL PAGES………………………………………………………...……ii
STATEMENT OF WORK’S ORIGINALITY…………………………….……iii
ABTRACT………………………………………………………………………...iv
PREFACE…………………………………………………………………….…...v
ACKNOWLEDGEMENT…………………………………………………….….vi
TABLE OF CONTENTS……………………………………….………….…..viii
LIST OF TABLES……………………………………………………………..…x
LIST OF APPENDICES………………………………………………………...xi
CHAPTER I. INTRODUCTION1
A. Background of the Study…………………...……………..1
B. Problem Formulations…………..…..…………………..…6
C. Purpose of the Study…………………..……………………6
D. Significance of the Study………………………………..…6
CHAPTER II. REVIEW OF RELATED LITERATURE AND
HYPOTHESIS DEVELOPMENT
A. Stocks Preferences…………………..…..……………….….8
B. Investors’ Characteristics Based on the Stock
Preference……….………………………..…………………11
C. Factors that Influence Stock Preference…………..….13
1) The Demographic Features………………………..….13
2) The Big Five Personality Traits……………………….15
CHAPTER III. METHODS
A. Population and Sample Selection…………………..….20
B. Measurement……………………………………….………24
C. Data Collection……………………………………..………27
D. Analysis Technique……………………..…………………28
viii
CHAPTER IV. RESULT AND DISCUSSION
A. RESULT………………………………………….……….…..30
1. Descriptive Statistics…………………..……….…..…..30
2. Goodness of Fit..……………………………………..…..35
3. Hypotheses Testing……………….……………..…..…..37
B. DISCUSSION…………………………………….………….41
CHAPTER V. CONCLUSIONS AND IMPLICATIONS
A. Conclusions……………….………………………………...48
B. Theoretical Implications…………………………….…….49
C. Applied Implications……………………………………....50
D. Limitations & Recommendations For Future
Research ………………………………………………….….51
REFERENCES….………………………………………………………………54
APPENDICES..…………………………………………………………………59
ix
LIST OF TABLES
Table
page
2.1 The Characteristics of Growth Stocks and Value Stocks………11
2.2 Description of Big five Personality Traits………………………….15
3.1 Respondents’ Characteristics……………………………..………...21
3.2 Respondents’ Related Information of Stock Investment……....22
3.3 Concepts and Indicators…………………………………..………....25
3.4 The Validity of the Instruments……………………….…………….26
3.5 The Reliability of the Instruments………………..…………..…….27
4.1 Descriptive Statistics of Respondents’ Big Five Personality
Types………………...……………………………………..……………..32
4.2 Descriptive Statistics of The Stock Preference………….………..34
4.3 The Stock Preference Distribution……………………….…………35
4.4 Regressions of Stock Preference on Demographic and
Personality Variables…………………..………………………………38
x
LIST OF APPENDICES
Appendix 1
Page
: Questionnaire……………………………………………….60
Appendix 2
: Respondents’ Characteristics …………………………..64
Appendix 3
: Respondents’ Related Information on Stock
Investment…...…………………………………..…………66
Appendix 4
: The Respondents’ Answers on Personality Traits ….67
Appendix 5
: The Respondents’ Answers on Stock Preference …...70
Appendix 6
: Validity of the Instruments ……………………………..72
Appendix 7
: Reliability of the Instruments …………………………..73
Appendix 8
: The Distribution of Stock Preference…………………..74
Appendix 9
: The Cross Tabulation of Gender and Education
towards Stock Preference…………………………..……75
Appendix 10 : Goodness of Fit……………………………….…………....76
Appendix 11 : Regression of Stock Preference on Demographic and
Personalities Variables.….……………………………....77
xi
INVESTORS’ DEMOGRAPHIC FEATURES AND
PERSONALITY TRAITS TOWARDS STOCK PREFERENCE
Thesis
Proposed To Master Of Management Post Graduate Program
To Obtain The Master Of Management Degree
By
Ruth Widyasari
912011036
Master of Management Study Program
Postgraduate Program
Satya Wacana Christian University
Salatiga
2014
ii
iii
ABSTRACT
This study aimed to find out what demographic factors and
the Big-Five Personality Traits, which influenced the investors’ stock
preference.
Seventy
six
investors
from
various
demographic
backgrounds were involved in this Study. It was found that
demographic factors, such as age, gender and education did not
influence the investors in making the decision of purchasing value
or growth stocks. The Big-Five Personality Traits employed to see
whether certain types of personality influenced the stock preference.
Personality traits, which influence the investors’ stock preference
were extraversion and openness to experience. While, neuroticism
and conscientiousness did not influence the stock preference.
Keywords: demographic factors, personality traits, stock preference
iv
PREFACE
This thesis consists of five chapters. The first chapter
focuses on the background idea and the problem related to
what demographic factors and personality traits, which might
influence the stock preference. The second chapter discusses
the literature and develops the hypotheses. In the second
chapter, stock preference, investors’ characteristics based on
stock preference, factors that influence stock preference are
elaborated to develop the hypotheses. Then, chapter three
explains the methods used in this study. The forth chapter
elaborates the result of the study. At the final, chapter five
conclude the overall study and point out the limitation, so
there would be improvement for future studies.
The writer hopes that this thesis would be very useful for
the future studies and is able to complete the reference in
finance.
Salatiga, 16 January 2014
Ruth Widyasari
v
ACKNOWLEDGEMENT
In completing this thesis, the writer did not work alone.
From the beginning until it has finished, some important
people helped the writer. Those people gave the writer
supports, guidance, even prayers when the writer wrote the
thesis and did the research. Therefore, in this page, the writer
would like to express the special gratitude for those special
people.
First of all, I’m willing to express my gratitude to the
advisor, Prof. Supramono, SE., MBA., DBA, who always
patiently gave the writer guidance in writing this thesis and
doing the research and support my study from the beginning
until the writer could finish it. Thank you for the advice and
strength so that the writer could write this thesis.
My deepest gratitude goes to my lovely husband,
mom, dad, and brother for their endless support in my whole
life. Nothing compares their loves for me. Especially for my
husband, thanks for your patience and love, for my mom for
your prayer everyday in my whole life.
My special thanks go to all investors involved in my
study, the Manager of Reksadana, Mas Rendy and and Cik
Lingling from PT. Trimegah, who has kindly helped me in doing
the research. My best gratitude also goes to all of the lecturers
in Master of Management Satya Wacana chritian Univesity and
also Mbak Ira, I know that without them I cannot finish this
study as well.
vi
The last but not the least, all of my friends, Kak Stany,
Lia, Kak Betty, Kak Herfin, Kak Welly and all the students of
MM UKSW thank you so much of being my best friends both in
class and outside the class. My special thanks are for my
partners in crime, Mas Anggit, Ruth Meike, Mas Izoel, Dita
Pinasti, Manda, and Rimpenk. Thank you for being such
wonderful persons for me.
The writer’s best gratitude is for those who have been
mentioned above. Without those people, the writer could not
finish this thesis in this semester. The contribution of those
people to this thesis is very precious for the writer. Finally,
“May He give you the desire of your heart and make all your
plans succeed.” (Psalm 20:4) God have given the writer success
in completing this thesis and hopefully He also give all of
people who helped the writer success in their life. Thank you.
Ruth Widyasari
vii
Table of Content
CONTENTS
Page
TITLE PAGE………………………………………………………………….……i
APPROVAL PAGES………………………………………………………...……ii
STATEMENT OF WORK’S ORIGINALITY…………………………….……iii
ABTRACT………………………………………………………………………...iv
PREFACE…………………………………………………………………….…...v
ACKNOWLEDGEMENT…………………………………………………….….vi
TABLE OF CONTENTS……………………………………….………….…..viii
LIST OF TABLES……………………………………………………………..…x
LIST OF APPENDICES………………………………………………………...xi
CHAPTER I. INTRODUCTION1
A. Background of the Study…………………...……………..1
B. Problem Formulations…………..…..…………………..…6
C. Purpose of the Study…………………..……………………6
D. Significance of the Study………………………………..…6
CHAPTER II. REVIEW OF RELATED LITERATURE AND
HYPOTHESIS DEVELOPMENT
A. Stocks Preferences…………………..…..……………….….8
B. Investors’ Characteristics Based on the Stock
Preference……….………………………..…………………11
C. Factors that Influence Stock Preference…………..….13
1) The Demographic Features………………………..….13
2) The Big Five Personality Traits……………………….15
CHAPTER III. METHODS
A. Population and Sample Selection…………………..….20
B. Measurement……………………………………….………24
C. Data Collection……………………………………..………27
D. Analysis Technique……………………..…………………28
viii
CHAPTER IV. RESULT AND DISCUSSION
A. RESULT………………………………………….……….…..30
1. Descriptive Statistics…………………..……….…..…..30
2. Goodness of Fit..……………………………………..…..35
3. Hypotheses Testing……………….……………..…..…..37
B. DISCUSSION…………………………………….………….41
CHAPTER V. CONCLUSIONS AND IMPLICATIONS
A. Conclusions……………….………………………………...48
B. Theoretical Implications…………………………….…….49
C. Applied Implications……………………………………....50
D. Limitations & Recommendations For Future
Research ………………………………………………….….51
REFERENCES….………………………………………………………………54
APPENDICES..…………………………………………………………………59
ix
LIST OF TABLES
Table
page
2.1 The Characteristics of Growth Stocks and Value Stocks………11
2.2 Description of Big five Personality Traits………………………….15
3.1 Respondents’ Characteristics……………………………..………...21
3.2 Respondents’ Related Information of Stock Investment……....22
3.3 Concepts and Indicators…………………………………..………....25
3.4 The Validity of the Instruments……………………….…………….26
3.5 The Reliability of the Instruments………………..…………..…….27
4.1 Descriptive Statistics of Respondents’ Big Five Personality
Types………………...……………………………………..……………..32
4.2 Descriptive Statistics of The Stock Preference………….………..34
4.3 The Stock Preference Distribution……………………….…………35
4.4 Regressions of Stock Preference on Demographic and
Personality Variables…………………..………………………………38
x
LIST OF APPENDICES
Appendix 1
Page
: Questionnaire……………………………………………….60
Appendix 2
: Respondents’ Characteristics …………………………..64
Appendix 3
: Respondents’ Related Information on Stock
Investment…...…………………………………..…………66
Appendix 4
: The Respondents’ Answers on Personality Traits ….67
Appendix 5
: The Respondents’ Answers on Stock Preference …...70
Appendix 6
: Validity of the Instruments ……………………………..72
Appendix 7
: Reliability of the Instruments …………………………..73
Appendix 8
: The Distribution of Stock Preference…………………..74
Appendix 9
: The Cross Tabulation of Gender and Education
towards Stock Preference…………………………..……75
Appendix 10 : Goodness of Fit……………………………….…………....76
Appendix 11 : Regression of Stock Preference on Demographic and
Personalities Variables.….……………………………....77
xi