An analysis of impact of personality traits and mindfulness on risk aversion of individual investors

Authors

รศ.ดร.เวสารัช เอื้อมบุญสุข, ศาสตราจารย์Anetta Caplanova

Published

Current Psychology

Abstract

The paper analyses the survey data collected among 100 Thai respondents to study the impact of personality traits based on Goldberg’s big five personality model and of mindfulness on risk aversion of individuals. PLS-SEM was performed in R Version 3.6.3 with plsSEM package. The results of the study show that agreeable people tend to be significantly less mindful, but individuals exhibiting conscientiousness, emotional stability and Openness tend to be significantly more mindful. The analysis of factors affecting risk aversion indicates that people characterized by agreeableness and emotional stability are significantly less risk averse, but people characterized by conscientiousness and Openness are significantly more risk averse. The analysis of the interaction between mindfulness and risk aversion indicates that more mindful individuals tend to be more risk averse. In addition, mindfulness has a significant mediating role on the association between personality traits and risk aversion. Specifically, mindfulness positively mediates the impact of conscientiousness and openness on risk aversion, but it negatively mediates the impact of agreeableness on risk aversion. Moreover, although emotional stability shows a direct negative impact on risk aversion, it has a significant positive impact on mindfulness, with mindfulness having a significant positive impact on risk aversion. The research has also shown that older people and women tend to be more risk averse, but men and married individuals are found to have lower degree of risk aversion. Education and income did not have significant impact on risk aversion of individuals.

(2564). An analysis of impact of personality traits and mindfulness on risk aversion of individual investors. Current Psychology, 2021(1), 1-18.