Purpose: This study aims to examine the roles of individual factors on risky investment intention as an indicator of risky financial behavior.Design/methodology/approach: The data were collected from a survey instrument and composed of 496 individuals’ responses. The authors exploited structural equation modelling and multigroup structural equation modelling for direct and indirect effects, respectively.Findings: Results indicate that emotional intelligence and locus of control have a positive impact on financial risk-taking, while risk aversion in general has the negative one. Although financial literacy does not have a direct effect on risky financial behavior, it has important role as a moderator variable, interacting with external locus of control.Originality/value: The authors expect this study to contribute into behavioral finance literature in two ways. First, they investigate joint and relative effects of four major factors (i.e. emotional intelligence, locus of control, risk aversion in general and financial literacy) identified in the literature on financial risk-taking of individual investors. Each belongs to a different venue in an individual’s psyche and therefore is expected to influence financial risk-taking through different mechanisms. However, the research arguing their roles on the financial risky behavior directly is very limited. Investigating their individual effects is likely to provide unique insights into our understanding of risky financial behavior. Second, the authors also posit and manifest that the effects of the first three of the aforementioned factors on risk-taking intentions are moderated by financial literacy. This finding is likely to provide rather valuable insights pertaining to the emergence of risk-taking behaviors and may shed light on the root reasons behind equivocal findings in previous research regarding the effect of each factor.

Purpose: The purpose of this paper is to evaluate published institutional investor research focused on home bias, disposition effect, and herding behavior in recognized journals and to ascertain some substantial gaps with regard to them. Design/methodology/approach: Recently published studies between 2005 and 2014, which intend to examine behavioral biases on institutional investors, have been reviewed through juxtaposing them under the three fundamental titles and figuring them according to the explanation why these biases occurs. Findings: The research examining home bias has identified the presence of this effect on institutional investors and explained it with information or culture. Yet, the existence of disposition effect has not been found in the extant research. These studies have estimated disposition effect through overconfidence and experience. Also, extant studies have provided evidence of herding behavior, attributing this behavior to pursuing same published information and protecting their reputation and career. Originality/value: Currently, no study, which reviews and evaluates the empirical research body on behavioral biases displayed institutional investors, exists. To the authors’ knowledge, this is the first paper which highlights the empirical evidence on these bias and summarizes the explanations in these studies for these biases exhibited by institutional investors. This could contribute to the researchers focusing on behavioral biases on institutional investors by providing them with a meaningful figuralization regarding their evidence and explanation.

Purpose: There is strong excitement during Ponzi schemes and financial bubble periods. This emotion causes investors to turn to “unknown and new investment instruments”. This study, the factors that made “unknown and new investment instruments” preferable to “known and experienced investment instruments” were investigated.Design/methodology/approach: It was taken into account unconscious like phantasy, emotional like emotional intelligence, both affective and cognitive like financial literacy and subjective beliefs like trust and overconfidence. In addition, risk preferences were measured with four different risk variables. In this context, data were collected by online survey method between November 2020 and May 2021 with convenience sampling. First, the data were collected from 832 participants in the pilot study. Additional data were also collected using convenience sampling and online surveys, and a total of 1,692 participants were obtained. Data were analyzed using Statistical Package for the Social Sciences (SPSS) 25 and AMOS 24.Findings: As a result of the analyses made, the variables that lead investors to choose “unknown and new investment instruments” were determined as risky investment intention, phantasy, risk taking/risk avoidance, confidence, risk tolerance and subjective financial literacy. Trust and risk perception have a very weak effect on preferences. However, no effect of emotional intelligence and objective financial literacy was detected. In addition, a moderately positive and significant relationship was found between objective and subjective financial literacy. Subjective financial literacy was found to have a strong and significant relationship with emotional intelligence, confidence, trust, risky investment intention and phantasy.Originality/value: This study investigates the factors underlying individuals' investment preferences from a broad perspective. We think that this study is unique in this structure and wide variables. We believe that the findings obtained in this manner are unique to both academics and practitioners. We also believe that the findings of the study will make an important contribution to understanding participation behavior in various Ponzi schemes and financial bubbles.

Purpose: This study aims to examine the impact of conscious and unconscious processes on risky investment intention. In this framework, the effect of individual cultural values and phantasy on risky investment intentions was investigated. In addition, the mediating role of phantasy in the relationship between individual cultural values and risky investment intentions was also analyzed.Design/methodology/approach: Data were collected between May 14, 2020 and June 01, 2020, when our graduate students voluntarily shared the online survey link on their social networks. In this way, 1,934 people in total answered the questionnaire. To test the study model, structural equation modeling (SEM) was performed using the AMOS program. In addition, ANOVA and independent sample t-test analyses were conducted using the SPSS program to analyze whether individual cultural values and risky investment intent differ according to demographic variables.Findings: According to the analysis results, power distance, collectivism, masculinity and long-term orientation are seen as antecedents of phantasy. While a positive relationship was found between power distance, collectivism and risky investment intention, a negative relationship was found between uncertainty avoidance and risky investment intention. Statistical findings regarding the mediating effect of phantasy on the relationship between individual cultural values and risky investment intentions were also determined. In addition to these, the differences in individual cultural values and risky investment intentions according to age, education level, sex and marital status were investigated. Individuals with the highest uncertainty avoidance level were in the 41–50 age group. Individuals with the highest long-term orientation level were individuals aged 41 and over. Individuals with the lowest risky investment intentions were in the +51 age group. Collectivism and power distance did not differ according to age. There were no differences in the relevant variables according to the level of education. Males have higher levels of risky investment intention, power distance, masculinity and collectivism than females, and married individuals have higher levels of uncertainty avoidance, masculinity and collectivism than singles.Originality/value: This study is the first to investigate the impact of conscious and unconscious processes on risky investment intentions together. On the other hand, the number of studies empirically investigating the relationship between phantasy and risky investment intention is quite limited, and the authors have also provided the findings for the existence of a relationship between these two variables.

Purpose: This study aims to quantitatively classify the articles with risk-taking and risk aversion keywords and to investigate whether there is a similar emphasis in articles as parallel to the change in risk appetite in the market in the period before the crisis (bubble period) and after the crisis.Design/methodology/approach: In this study, a bibliometric analysis of the articles in which the keywords risk-taking and risk aversion are mentioned together with the word finance in the journals scanned in the Web of Science between 2004 and 2012 was performed. In this context, 936 articles were specified. Analyses were made using the CiteSpace Java program.Findings: The three journals with the most articles with these characteristics are Journal of Banking and Finance, Journal of Financial Economics and Strategic Management Journal. Along with these two main keywords, the other two most used keywords were “model” and “performance”. In addition, the keywords “attitude”, “corporate governance”, “choice” and “determinant” were used more in the post-crisis period. On the other hand, concepts such as investor sentiment or emotions were not amongst the 10 most frequently used keywords during the nine years. This can be considered as an indicator that risk is being modelled, but emotions are relatively neglected. As a result, the findings of this study show that academic papers do not develop in connection with the mood and excitement in the market.Originality/value: This study is one of the first studies to examine the reflection of risk appetite in the market on academic papers on financial risk-taking and aversion and to investigate whether the situation in the market and the development in publications are related.

Decision-making processes occur with the interaction of some cognitive and psychological variables. Neoclassical theories deal with rational reactions in these processes. However, in an environment where there is no information or where there is uncertainty instead of risk, decisions cannot be made rationally as the mind indicates. In this direction, firm managers have to make many decisions under uncertainty. For this reason, managers resort to various simple and useful shortcuts called bias for different reasons. In this study, it was aimed to reveal the effects of behavioral biases on management decisions. In this context, five biases in the behavioral finance literature, namely overconfidence, status quo, anchoring, hindsight and availability, were evaluated with theoretical and empirical studies and their effects on managerial decisions were discussed. It was seen that raising awareness of these biases in terms of managers provides benefits such as realistic evaluation of themselves, giving more realistic weights to events when making decisions, reaching rational judgments more easily and being open to innovations. In addition, this awareness, when combined with the emotional competencies of managers, helps them make successful decisions.