Risk tolerance and investment choices among the youth in Ghana
Date
2020-05
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Abstract
To make the most out of investment choices, investment advisors need to
understand the risk propensity that an investor can tolerate. However, measuring this risk
propensity is very difficult, as it must be quantified. Among the many factors that influence
risk tolerance is the demographic profile of the investor. A review of the literature proved
that extensive research exists in the area or has been explored. However, the findings are
inconclusive. This scenario displays an unclear picture of the demographic factors that
affect risk. This study explored the influence of selected demographic factors, the
variations within the demographic factors, and determine whether there was a significant
association between f risk tolerance and investment choices of the investors. A quantitative
method was employed with a sample size of 231. The study used a binary logistics regression
model and contingency analysis. The results showed that gender had a significant influence on
risk tolerance. Education, employment status, religion, and one’s Christian denomination were
not significant predictors. Findings from the research also suggested that females, high
school students, younger investors, and Christians are risk-averse. However, among the
Christian denominations, Catholics and Pentecostals are risk-averse. Finally, the study
concluded that there was a significant association between risk tolerance and investment
choices.
Description
Undergraduate thesis submitted to the Department of Business Administration, Ashesi University, in partial fulfillment of Bachelor of Science degree in Business Administration, May 2020
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Keywords
risk propensity, demographic factors, investment, religious denominations