Cryptocurrency investment: Evidence of financial literacy, experience, and risk tolerance
The growing popularity of cryptocurrency as an investment choice among millennials demonstrates their inclination toward digital advancements and openness to exploring diverse investment opportunities. The study examines how financial literacy factors impact experience regret, investment decisions,...
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| Format: | Article |
| Language: | English |
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LLC "CPC "Business Perspectives"
2024-08-01
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| Series: | Investment Management & Financial Innovations |
| Subjects: | |
| Online Access: | https://www.businessperspectives.org/images/pdf/applications/publishing/templates/article/assets/20520/IMFI_2024_03_Sa’diyah.pdf |
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| _version_ | 1832544336273735680 |
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| author | Chalimatuz Sa’diyah Bambang Widagdo Fika Fitriasari |
| author_facet | Chalimatuz Sa’diyah Bambang Widagdo Fika Fitriasari |
| author_sort | Chalimatuz Sa’diyah |
| collection | DOAJ |
| description | The growing popularity of cryptocurrency as an investment choice among millennials demonstrates their inclination toward digital advancements and openness to exploring diverse investment opportunities. The study examines how financial literacy factors impact experience regret, investment decisions, and risk tolerance, while financial literacy also affects investment decisions, with experience regret and risk tolerance acting as a mediator. The study comprises 295 participants from the millennial demographic in Indonesia who are engaged in cryptocurrency investment. The data collection techniques employed in this study involve non-probability sampling methods through the distribution of questionnaires. The analysis in this study employs Structural Equation Modeling (SEM) in conjunction with Partial Least Squares (PLS) analysis tools. The results of this study suggest that financial literacy positively impacts regret experience, investment decisions, and risk tolerance with the respective sample values of 0.146, 0.397 and 0.449. Additionally, regret experience negatively influences investment decisions with a sample value of –0.385, while risk tolerance positively influences investment decisions with a sample value of 0.198. Financial literacy has a negative impact on investment decisions when regret experience acts as a mediator with a sample value of –0.056, but a positive impact when risk tolerance serves as a mediator with a sample value of 0.089. This complex relationship highlights the importance of considering multiple factors, including financial literacy, regret experience, and risk tolerance, in understanding and predicting investment decisions among individuals, particularly in the context of the millennial generation investing in cryptocurrency in Indonesia. |
| format | Article |
| id | doaj-art-54a9b68acb6b421c898449efcf1dadf5 |
| institution | Kabale University |
| issn | 1810-4967 1812-9358 |
| language | English |
| publishDate | 2024-08-01 |
| publisher | LLC "CPC "Business Perspectives" |
| record_format | Article |
| series | Investment Management & Financial Innovations |
| spelling | doaj-art-54a9b68acb6b421c898449efcf1dadf52025-02-03T10:35:16ZengLLC "CPC "Business Perspectives"Investment Management & Financial Innovations1810-49671812-93582024-08-0121314815910.21511/imfi.21(3).2024.1320520Cryptocurrency investment: Evidence of financial literacy, experience, and risk toleranceChalimatuz Sa’diyah0https://orcid.org/0000-0001-8572-2069Bambang Widagdo1https://orcid.org/0000-0002-8177-0853Fika Fitriasari2https://orcid.org/0000-0002-6647-4319SE., MM., Assistant Professor, Management Study Program, Faculty of Economics and Business, Muhammadiyah University of Malang, IndonesiaMM, Professor, Management Study Program, Faculty of Economics and Business, Muhammadiyah University of Malang, IndonesiaSE., MM., Assistant Professor, Faculty of Economics and Management, Universiti Kebangsaan Malaysia, MalaysiaThe growing popularity of cryptocurrency as an investment choice among millennials demonstrates their inclination toward digital advancements and openness to exploring diverse investment opportunities. The study examines how financial literacy factors impact experience regret, investment decisions, and risk tolerance, while financial literacy also affects investment decisions, with experience regret and risk tolerance acting as a mediator. The study comprises 295 participants from the millennial demographic in Indonesia who are engaged in cryptocurrency investment. The data collection techniques employed in this study involve non-probability sampling methods through the distribution of questionnaires. The analysis in this study employs Structural Equation Modeling (SEM) in conjunction with Partial Least Squares (PLS) analysis tools. The results of this study suggest that financial literacy positively impacts regret experience, investment decisions, and risk tolerance with the respective sample values of 0.146, 0.397 and 0.449. Additionally, regret experience negatively influences investment decisions with a sample value of –0.385, while risk tolerance positively influences investment decisions with a sample value of 0.198. Financial literacy has a negative impact on investment decisions when regret experience acts as a mediator with a sample value of –0.056, but a positive impact when risk tolerance serves as a mediator with a sample value of 0.089. This complex relationship highlights the importance of considering multiple factors, including financial literacy, regret experience, and risk tolerance, in understanding and predicting investment decisions among individuals, particularly in the context of the millennial generation investing in cryptocurrency in Indonesia.https://www.businessperspectives.org/images/pdf/applications/publishing/templates/article/assets/20520/IMFI_2024_03_Sa’diyah.pdfexperience regretfinancial behaviorfinancial literacyinvestment decision |
| spellingShingle | Chalimatuz Sa’diyah Bambang Widagdo Fika Fitriasari Cryptocurrency investment: Evidence of financial literacy, experience, and risk tolerance Investment Management & Financial Innovations experience regret financial behavior financial literacy investment decision |
| title | Cryptocurrency investment: Evidence of financial literacy, experience, and risk tolerance |
| title_full | Cryptocurrency investment: Evidence of financial literacy, experience, and risk tolerance |
| title_fullStr | Cryptocurrency investment: Evidence of financial literacy, experience, and risk tolerance |
| title_full_unstemmed | Cryptocurrency investment: Evidence of financial literacy, experience, and risk tolerance |
| title_short | Cryptocurrency investment: Evidence of financial literacy, experience, and risk tolerance |
| title_sort | cryptocurrency investment evidence of financial literacy experience and risk tolerance |
| topic | experience regret financial behavior financial literacy investment decision |
| url | https://www.businessperspectives.org/images/pdf/applications/publishing/templates/article/assets/20520/IMFI_2024_03_Sa’diyah.pdf |
| work_keys_str_mv | AT chalimatuzsadiyah cryptocurrencyinvestmentevidenceoffinancialliteracyexperienceandrisktolerance AT bambangwidagdo cryptocurrencyinvestmentevidenceoffinancialliteracyexperienceandrisktolerance AT fikafitriasari cryptocurrencyinvestmentevidenceoffinancialliteracyexperienceandrisktolerance |