Hendrawaty, Ernie DEMOGRAPHIC FACTORS, FINANCIAL LITERACY T AND TOLERANCE LEVELS OF FINANCIAL RISK: A STUDY OF POTENTIAL INVESTORS IN INDONESIA. BOOK OF ABSTRACTS. ISSN 1549-9332

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Abstract

The level of financial literacy in Indonesian society is still very low at 22%, varying among different financial sectors. The lowest levels of financial literacy is found at the capital market sector with only 4% and levels at capital market products only 0,1%. The Indonesian government through Authority of Financial Services (OJK) has a responsibility to educate and cultivate awareness for potential investors. OJK targets the national financial literacy levels to increase to 27,8% by 2016. Studies on the benefits of financial literacy programs remain controversial: the factors being researched are financial literacy and demographic factors. Furthermore this study also investigate the role of demographic factors in making more apparent the role of financial literacy towards the risk tolerance in relation to the behavior of investation in the capital market by potential investors. Number of respondents are 192 people. The data is collected using a questionnaire. The analysis method used is the Moderated Regresion Analysis (MRA). This study support that demographic factors are a significant determinant of the level of tolerance towards risk, meanwhile the benefit of financial literacy is still inconsistent as a determinant of level of tolerance towards risk. However the role of demographic factors is not strong enough to improve the influence of financial literacy to the level of risk tolerance. The advice for further research is to develop similar research in the future to resolve the flaws of this research, by incorporating the behaviorial and psycological factors as factors which influence investor in making their decision to invest. Keyword: Financial Literacy, Demographics, Financial Risk Tolerance

Item Type: Article
Subjects: H Social Sciences > HG Finance
Divisions: Fakultas Ekonomi dan Bisnis (FEB) > Prodi Manajemen
Depositing User: DR ERNIE HENDRAWATY
Date Deposited: 03 Aug 2018 07:34
Last Modified: 03 Aug 2018 07:34
URI: http://repository.lppm.unila.ac.id/id/eprint/8573

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