Effect of financial literacy and risk aversion on the relationship between self-control and financial security of individual investors in Tehran Stock Exchange

Document Type : Research Paper


Department of Accounting, Aliabad Katoul Branch, Islamic Azad University, Aliabad Katoul, Iran


Capital markets play an important role in the economy and naturally, the proper functioning of the capital market will play a key role in ensuring economic growth. So, if capital markets are efficient, economic development will be ensured. On the other hand, since the Iranian stock market is currently very popular among investors, it is undoubtedly important to examine the behavioral biases of individual investors. Therefore, in this study, the effect of positive self-control behavioral bias on financial security was investigated with the moderating role of financial literacy and risk aversion of individual investors. For this purpose, the statistical population consisted of individual investors, traders and brokers of Tehran Stock Exchange who are directly participating in the market. Also, the statistical sample was calculated to be 421 using Cochran’s formula. A structural equation model using PLS method was used to analyze the data. The results showed that the self-control variable has a significant positive effect on risk aversion and financial security. Also, by using the financial literacy variable as a moderating variable, the intensity of the relationship between self-control and financial security of individual investors increases; that is, the financial literacy of individual stock market investors intensifies the positive relationship between self-control and security of their financial behavior. In addition, by using risk aversion as moderating variable, the intensity of the relationship between self-control and financial security of individual investors is reduced. This means that the risk aversion of individual stock market investors reduces the positive relationship between self-control and the security of their financial behavior.


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Volume 13, Issue 1
March 2022
Pages 2015-2024
  • Receive Date: 01 August 2021
  • Revise Date: 13 October 2021
  • Accept Date: 21 October 2021
  • First Publish Date: 30 November 2021