ACCI Conference 2024

This research examines the relationship between investment literacy and the diverse motivations that drive individuals to invest. The study investigates five primary motivational factors that encompass the spectrum of investor intent, including short-term investment gain, entertainment/engagement, social interactions, social support, social responsibility, and the pursuit of knowledge. The findings derived from the 2021 National Financial Capability Study (NFCS) Investor Survey demonstrate a negative relationship between persons possessing a high level of objective investment literacy and their multifaceted investment motivation towards short-term profit, entertainment/engagement, social interactions, and social responsibility. Investors with a higher level of subjective investment literacy exhibit a greater inclination towards being driven by short-term profitability, entertainment/engagement, social interactions, , social responsibility, and learning objectives in the context of investment activities. Moreover, risk tolerance is also associated positively with all investment motivations. The results of this study have implications for researchers and consumer financial service practices.

Author(s): Yi Liu, Kyoung Tae Kim