An Integrated Model of Personality Traits and Psychological Biases Influencing Investment Decisions: Evidence from IT Professionals in Bangalore

Abstract

This study examines the influence of psychological factors and personality traits on the investment decisions of IT professionals in Bangalore. Drawing on the Theory of Planned Behaviour and the Big Five Personality Framework, the study develops a conceptual model to explain how cognitive biases and enduring personality dimensions shape financial decision-making. The research employs Structural Equation Modelling (SEM) to test the proposed hypotheses using primary data collected from 384 IT professionals actively trading in the Indian stock market. The findings reveal that heuristics exert a positive and statistically significant influence on investment decisions, indicating the prominence of simplified cognitive processes in shaping investor behaviour. Furthermore, personality traits demonstrate a positive and significant effect on investment decisions, suggesting that stable individual differences meaningfully contribute to financial choices. The results extend behavioural finance literature by providing empirical evidence from a high-pressure professional context, where technological expertise and market participation intersect. The study offers practical implications for policymakers, financial advisors, and capital market regulators, emphasizing the importance of incorporating psychological and personality-based insights into investor education initiatives, particularly for retail investors employed in the rapidly evolving information technology sector. These findings underscore the need for targeted awareness programs that mitigate biases and promote disciplined, informed, and long-term investment strategies among emerging retail participants