Perceived Risk, Investment Performance and Intentions in Emerging Stock Markets

Abstract

The study built the new measurement scales of risk perception in investing in stock types trading on the emerging stock market, and then explored the effects of perceived risk on investment performance and intentions of individual investors. The study employed mixed research methods including in-depth interviews, a pilot study involving 50 investors, a survey distributed to 465 retail investors. Results showed that perceived risk had the direct positive impact on both investment performance and intentions. Perceived risk also had the indirect influence on intentions to invest through investment performance. For managerial decisions, investors are recommended to draw attention to the risks of investing in stocks labelled as warned , controlled , and halted trading . The higher investors perceive the risks of these stock types, the greater they are satisfied with their investment decisions, the recent rate of return achieved, and the more they intend to invest in the next time. Securities corporations have regularly organized seminars, workshops or training courses about investing in the kinds of stocks, updated regulations of stock investment in time, and improved the quality of listed companies to attract more investors to the stock market.

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