Behavioral Bias of Individual Investors: Evidence from Borsa İstanbul

Abstract

Traditional finance theories regard investors as rationalist people. However, behavioral finance argues that individual investors do not make rational financial decisions and that they are affected by their psychologies when they make financial decisions. The main purpose of this study is to analyze investors of Borsa Istanbul that live in Gaziantep within the concept of behavioral finance. In accordance with this purpose, the survey has been conducted on the investors that live in the city, and the behaviors exhibited by investors while making investment decisions have been revealed by the help of t-test, ANOVA, and Tukey test methods. The results of these analyses reveal that individual investors living in Gaziantep are not much rational when they make investment decisions and that they are affected by psychological factors.