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http://dx.doi.org/10.13106/jafeb.2022.vol9.no4.0053

Does Disposition Effect Appear on Investor Decision During the COVID-19 Pandemic Era: Empirical Evidence from Indonesia  

ASNAWI, Said Kelana (Management Study Program, Kwik Kian Gie Institute of Business and Informatics)
SIAGIAN, Dergibson (Management Study Program, Kwik Kian Gie Institute of Business and Informatics)
ALZAH, Salam Fadillah (Business Administration Study Program, Kwik Kian Gie Institute of Business and Informatics)
HALIM, Indra (Accounting Study Program, Faculty of Economics and Business, Christian University of Indonesia)
Publication Information
The Journal of Asian Finance, Economics and Business / v.9, no.4, 2022 , pp. 53-62 More about this Journal
Abstract
Disposition Effect (DE) is one of the many investment biases, wherein the investors sell the profitable stocks rather quickly and they tend to hold on the loss making stocks. Various factors related to the DE are the character of investors applying risk management which is also influenced by the social media, Salient Shock (COVID-19), and in the specific case of Indonesia, the phenomenon of rumor stocks wherein the price can rise as much as up to 8500%. The study aims to provide empirical evidence regarding the DE with specific explanatory factors, namely investor behavior and rumors. Data was obtained through a questionnaire sent to 248 Indonesian Stock Exchange Investors (IDX) during the period October-November 2021 by using Ordinary Least Square (OLS) method. The results show: Generation Z, women, and investors with a low education has a greater DE, risk-takers tend to have lower DE, and professionals have negative DE. Implementation of risk management will reduce DE. Social Media and the COVID-19 situation positively affect DE. Especially on stock rumors, there is evidence that investors who own rumor stocks will have a low DE. The results indicate the need for: (i) risk management, especially for Z Generation, women and low education Investors, (ii) to provide positive information so that information on social media can be responded to positively.
Keywords
Disposition Effect; Rumor; COVID-19; Risk Management; Social Media;
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Times Cited By KSCI : 6  (Citation Analysis)
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