Gender: Behavioural finance and satisfaction of life

Abstract

Behavioural finance is becoming more predominant in the financial and investment industry. The general concept of behavioural finance suggests that investors do not necessarily make rational investment decisions. It argues that investment decisions are often influenced by emotional or other non-rational factors leading to irrational investment choices. One may conclude that in many instances investors display investment behaviour in line with behavioural finance theory without realising it. Behavioural finance is based on the "emotional" experiences of investors when investing. Different "types of emotional experiences" are labelled as behavioural finance biases which may lead to or cause subjective investment decision-making. The aim of this study was to configure which behavioural finance biases influence male and female investors and to analyse the satisfaction with life of male and female investors. Results from this study indicated that male and female investors are subject towards behavioural finance biases. Representative bias was most relevant for male and female investors and male investors were found to be more satisfied with their lives than female investors.