An Analysis of the Effects of Financial Literacy, Overconfidence Bias, and Herding Behavior on Investment Decisions Among Millennial and Gen Z Workers in Surabaya
DOI:
https://doi.org/10.55927/ijsmr.v4i3.14Keywords:
Financial Literacy, Overconfidence Bias, Herding Behavior, Investment Decision, Behavioral FinanceAbstract
This study aims to examine the influence of financial literacy, overconfidence bias, and herding behavior on investment decisions among Millennial and Generation Z workers in Surabaya. The research adopts a quantitative approach with an explanatory design to analyze the causal relationships between variables. Primary data were collected through a structured questionnaire distributed to 100 respondents selected using purposive sampling techniques. The results indicate that financial literacy has a positive and significant effect on investment decisions, suggesting that individuals with higher financial knowledge are more capable of making rational and informed investment choices. These findings highlight the importance of both rational and behavioral factors in influencing investment decisions. Financial literacy enhances individuals’ ability to process financial information effectively, while herding behavior reflects the influence of social dynamics in investment activities. This study contributes to the behavioral finance literature by providing empirical evidence from an emerging market context and emphasizes the need for improving financial literacy among young workers.
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