Investment Behaviour and Coloured Price Paths: the Effect of a Price Path’s Colour on the Willingness to Invest
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2023-07-17
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en
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Price paths are crucial in the investor’s decision-making process, as they often serve as the only graphical representation of financial products that investors rely on before making an investment. Although some research has been conducted on how the shape of price paths influences investor behaviour, the effect of colour usage in these price paths remained unexplored. Through an online survey experiment where participants needed to indicate their willingness to invest on a 10-points Likert scale after being presented with a price path displayed in either black, red, green, or blue, this study investigates whether the colour of a stock’s historical price path influences investment behaviour. Because it is well-known that colours influence human behaviour, it was expected that a price path’s colour would have a statistically significant effect on investment willingness. Despite the lack of statistically significant evidence, the results are in line with expectations. It is a possibility that the influence of colour is subtle and difficult to measure within the study design used. Therefore, further research with a broader scope and additional variables is needed.
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Faculteit der Managementwetenschappen