Abstract: The limitation of fundamental knowledge of cognitive biases that motivates investment behaviour has been one of the problems facing investors in the Nigerian property market. Thus, this study was aimed at establishing the cognitive biases influencing investment decision-making in property market in Plateau State, Nigeria. The objective that guided the study was the influence of anchoring bias on investment decision making in property market in Plateau State, Nigeria. Descriptive research design was used in the study. The study population comprised of property agents who were investment traders at the property market in Plateau State and currently registered and licensed to operate in Plateau State property market in Nigeria. The target population comprised of 1650 registered property investors trading at the property market in Plateau State and currently licensed to operate in Plateau state property market in Nigeria. Property investors were targeted. Multi-stage sampling procedure was used in the selection of representative sample comprising of purposive sampling and the normal approximation to the hyper-geometric distribution to select the sample size. The final sample size was thus comprised of 312 respondents. Primary data was collected using standard questionnaires with both closed and open ended questions. Cronbach’s Alpha Test was used to test the internal consistency reliability of measurements. The study employed both descriptive and inferential statistics to allow presentation of data in a more meaningful way and thus simpler interpretation of data. Normality test was done for qualitative data to test for normal distribution for all dependent and independent variables. Jarque bera test was used to examine normality. The regression analysis results further confirmed that there was a significant positive linear relationship between anchoring bias on investment decision making in property market in Plateau State in Nigeria. The study concluded that anchoring bias effect in making investment decisions, is solely determined by years of experience as an investor. The positive coefficient on these variables was consistent with expectations that more experienced investors used more personal judgment in making decisions. The main recommendation for investors is to make constant attempts to increase their awareness on behavioral finance by educating themselves on the field. Studying about the biases, and reflecting on their decisions are likely to help achieve better self-understanding of the extent and manner to which they gets influenced by emotions while making financial decisions under uncertainty. Even after satisfactory awareness is achieved it is highly recommended that they maintain a chart of the behavioral biases they are likely to be vulnerable to.
Keywords: property market, investment traders, Property investors, making decisions.
Title: INFLUENCE OF ANCHORING BIAS ON INVESTORS' DECISION MAKING IN PROPERTY MARKET IN PLATEAU STATE, NIGERIA
Author: DASHOL ISHAYA USMAN, Dr. Willy M. Muturi, Dr. Florence S. Memba
International Journal of Management and Commerce Innovations
ISSN 2348-7585 (Online)
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