Abstract:
Stock market takes a big part of a nation’s economy. Whereas, Indonesia
market stays low for long time,especially for last year the stock market has
declined to 12.13%. One of the reason is people are prefer saving money in
the bank. Hence, this objective was to find the factors influencing stock
investors’ investment behavior. Though the stock market exchange is in
Jakarta and Surabaya, the research was conducted in Jakarta only due to time
and monetary constraints. This research applied quantitative method with
purposive sampling technique to spread questionnaires with 289 stock
investors in Jakarta, Indonesia. The factor analysis was applied to find and
group the factors and tested validity. Further Cronbach’s Alpha was applied to
test the reliability of the survey instrument. Finally Multiple Regression was
applied to test the significant of each independent variables (psychological
factors, demographic factors, financial literacy, current state and risk tolerance)
towards dependent variable (investment behavior). The result of the research
is that psychological factors, economic condition and risk tolerance are the
significant factors influence investors’ investment behavior and demographic
factors and financial literacy are not influencing investors’ behavior. So
investors need to think carefully when they doing investment in stock market.
Besides, government also need to make effort to help investors when they
trying to invest in stock market.
