Analysis of investor behavior and perceptions regarding risk, from the viewpoint of behavioral finance theory

Abstract

This research study aimed to evaluate behavior and perceptions regarding risk in different investment options among individuals pursuing master's degree and PhD programs in Management. To this end, the authors verified which were the variables with the greatest influence upon the respondents' willingness to pay and the perception of risk as compared to the risk calculated using standard deviations. The research was conducted by means of an electronic questionnaire. Correlation, cross-tabulation and multiple linear regression were applied to the survey results. The authors observed that the expected return was what most influenced the decisions, that the respondents were less than rational in their choices, and that they perceived less risk in the investment options than what the standard deviation indicated.