The Effect of Herding Bias, Overconfidence, and Risk Tolerance on Stock Investment Decision-Making on Students in Accounting Department of Bali State Polytechnic

Arisanti, Ni Made Winda and Suandi, I Ketut and Suta, I Wayan Purwanta (2022) The Effect of Herding Bias, Overconfidence, and Risk Tolerance on Stock Investment Decision-Making on Students in Accounting Department of Bali State Polytechnic. Repositori Politeknik Negeri Bali.

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Abstract

Students are the individuals who have the potential to invest because they have learned during lectures. Students can apply the theory they have learned in real terms in the form of investment practice. However, investment decision-making by investors is not always done rationally. Many factors influence investment decision-making. One of them is social factors, namely herding bias, and psychological factors, namely overconfidence and risk tolerance. This study aims to describe the effect of herding bias, overconfidence, and risk tolerance partially and simultaneously on stock investment decision-making in students of the Bali State Polytechnic Accounting Department. This study analyzed primary data from the questionnaire. The respondents in this study were 106 students of the 2018 Applied Managerial Accounting Undergraduate Study Program who had taken the capital market and investment courses. Testing of research variables was carried out using multiple linear regression analysis techniques. The results of this study indicate that partially, herding bias and risk tolerance have a positive and insignificant effect on stock investment decision-making in students majoring in Accounting at the Bali State Polytechnic. Meanwhile, overconfidence has a positive and significant effect on stock investment decision-making in students majoring in Accounting at the Bali State Polytechnic. Simultaneously or together, herding bias, overconfidence, and risk tolerance have a positive and significant effect on stock investment decision-making in students of the Bali State Polytechnic Accounting Department.

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