Behavioural Bias and Investment Decisions of Dangote Sugar Refinery Plc.

Abstract

The study examines the relationship behavioural bias and investment decisions of Dangote Sugar Refinery Plc. The study formulates two hypotheses and applied multiple regression technique to analyze the relationship between the dependent variable investment decisions and independent variable behavioural bias. The independent variable was proxy by anchoring bias and disposition effect. Primary data was used, the data was collected from the individual shareholders of Dangote Sugar Refinery Plc through adapted questionnaires, the sample size was 383. The collected data was analyzed by using Smart-PLS version 3. The findings of the study showed that anchoring bias effect has a significant effect on investment decisions on shareholders of Dangote Sugar Refinery Plc and disposition effect has no significant effect on investment decisions on shareholders of Dangote Sugar Refinery Plc. The study recommends that shareholder should obtain the opinion of stock brokers/fund managers regarding the profitability of a certain stock in which they desire to purchase. Individual investors should be educated in stock market activates, because this will help them surmount unfavorable investment returns induced by behavioural biases.