The Impact of Financial Literacy and Risk Perception on the Investment Decisions of Young Adults in Surabaya

Abstract

Investment decisions are important as they allocate an investor’s funds towards assets after further contemplation. As young investors dominate the total amount of investors the last few years, investors should be aware of the factors impacting investment decisions. Despite its importance, little to no studies have researched the impact of financial literacy and risk perception towards investment decisions with young adults of Surabaya as the research target. The research mainly based its theoretical foundation on the research conducted by Saputro and Lestari (2019), which discussed financial literacy and risk perception influence on individuals’ investment decisions. The data for the research is collected through questionnaires with the total of 89 respondents that fulfilled requirements. Then, the data is analyzed by using Multiple Linear Regression through IBM SPSS Statistics. The results indicated that financial literacy and risk perception has a positive significant relationship to investment decisions of young adults in Surabaya simultaneously and individually.

Keywords:

Investment Decision, Risk Perception, Financial Literacy.