Evaluating stock trading behaviour: Information sources nexus through intrinsic and extrinsic motivation

This study examines the effects of sources of information, including word‐of‐mouth (WOM) communication, and financial advice, on intrinsic and extrinsic motivations and stock trading behaviour in Pakistan. To test the model, we gathered 477 survey responses from individual stock investors. Our resul...

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Bibliographic Details
Published in:International journal of finance and economics 2022-07, Vol.27 (3), p.2965-2976
Main Authors: Khan, Safeer Ullah, Wang, Mansi, Khan, Ikram Ullah, Liu, Xiang‐dong
Format: Article
Language:English
Subjects:
Financial advice
intrinsic and extrinsic motivations
Pakistan
Securities trading
stock trading
WOM communication
Word of mouth advertising
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Summary:This study examines the effects of sources of information, including word‐of‐mouth (WOM) communication, and financial advice, on intrinsic and extrinsic motivations and stock trading behaviour in Pakistan. To test the model, we gathered 477 survey responses from individual stock investors. Our results exhibit that WOM communication and financial advice significantly influence stock trading behaviour. We also find that intrinsic motivations significantly mediate between financial advice and stock trading behaviour. Extrinsic motivations have significant mediation effects between sources of information and stock trading behaviour. Taken together, the results indicate that financial advice indirectly sparks stock trading through intrinsic and extrinsic motivations, whereas WOM communication performs the same function only through extrinsic motivations. The study results have several theoretical and practical implications for investors, stock brokerage firms, regulators, and governments.
ISSN:1076-9307
1099-1158
DOI:10.1002/ijfe.2307