





































Indian Journal of Finance and Banking 

 Vol. 9, No. 1; 2022 

                                       ISSN 2574-6081   E-ISSN 2574-609X 

Published by CRIBFB, USA 

19 

THE EFFECT OF DEMOGRAPHIC CHARACTERISTICS ON RISK 

PERCEPTION AND INVESTMENT DECISION: AN EMPIRICAL 

STUDY IN VIETNAM 
 

 

Dr. Shu-Hui Su 

Assistant Professor 

Department of Accounting 

I-Shou University, Taiwan 

E-mail: shuhuisu@isu.edu.tw 

https://orcid.org/0000-0002-7254-6155 

 

Dr. Yao-Ling Liu 

Associate Professor & Chairperson 

Department of Hospitality Management 

I-Shou University, Taiwan 

E-mail: ylliu@isu.edu.tw 

https://orcid.org/0000-0001-8710-3309 

 

Dr. Hsiu-Ling Lee 

Assistant Professor 

Department of Accounting 

I-Shou University, Taiwan 

Corresponding Author E-mail: shannon@isu.edu.tw 

https://orcid.org/0000-0002-6932-2062 

 

Tran Thi Kim Quy 

MBA Student 

College of Management 

I-Shou University, Taiwan 

E-mail: kimquy1303@gmail.com 

https://orcid.org/0000-0002-7254-6155 

 

 

Received: October 19, 2021      Accepted: December 17, 2021        Online Published: January 16, 2022  

 

DOI: 10.46281/ijfb.v9i1.1548            URL: https://doi.org/10.46281/ijfb.v9i1.1548 

 

 

ABSTRACT 

The purpose of this study is to investigate how demographic characteristics, such as gender, age, 

income, investing experience, education, marital status, and occupation, affect risk perception and 

investment decision by surveying of investors in Vietnam. The research also examines the relationship 

between risk perception and investment decision. This paper helps researchers have a clear 

understanding of how Vietnamese investors with different demographic profiles will invest their money 

and how the demographic characteristics will affect their risk perception. The research discovers that 

demographic factors such as age, income, occupation, and investing experience have significant 

effects on the risk perception of investors meanwhile income, gender, and investing experience are 

mailto:ylliu@isu.edu.tw
mailto:kimquy1303@gmail.com


https://www.cribfb.com/journal/index.php/ijfb                       Indian Journal of Finance and Banking                            Vol. 9, No. 1; 2022 
 

20  

strongly related to investment decision. The analysis result also verifies that risk perception is 

associated with investment decision. The survey data were collected from 167 samples including 

students, company employees, or people who run their own business with the age of 18 to 45. It was 

conducted for general investors and had practical implications for mutual funds, financial advisors, 

and bankers. 

 

Keywords: Financial Behavior, Demographic Characteristics, Risk Perception, Investment Decision. 

 

JEL Classification Codes: G11, G40, G41. 

 

INTRODUCTION 

Nowadays, financial behavior is a crucial part of the decision-making process, because it substantially 

affects investors’ behavior and decision making. Risk is always an essential factor need to be 

considered when making an investment decision. In recent years, the impact of risk perception on 

investment decisions is an emerging subject in the financial behavior literature. Hence, a better 

understanding of financial behavior in general and risk perception, in particular, will assist the 

investors to make a better investment decision. There are several economic and behavioral financial 

theories assuming that investors act rationally; however, they are only human. They act according to 

the majority’s opinions and some even follow their instinct and feeling when making financial 

decisions (Raiz, Hunjra, & Azam, 2012). Demographic profile and risk perceptions play an important 

role to select a particular choice of investment as the result of previous researches. Rohrmann (1999) 

focused on six issues that influence an individual’s perception of risk, one of them being the issue of 

personality characteristics and demographic differences among a diversified population of subjects and 

respondents. Bashir, Shaheen, Batool, Butt, and Javed (2014) investigated what factors influence risk 

perception of the individual investors and found demographic characteristics (such as age, gender, 

income, and education) have significant effects on risk perception in the case of Pakistani investors. 

Abdeldayem (2015) found that individual investors’ decision-making is influenced by risk perception 

when they invested in the bonds market. Yuliani, Isnurhadi, and Jie (2017) discovered that emotion, 

moods, and other factors of investors affect perception. Patel and Modi (2017) revealed that 

demographic factors (age, gender, and income) have significant effects on investment decisions. 

Risk is an inherent feature of all types of financial investments. Risk in investing always 

attracts attention from an investor because of its uncertainty and unpredictability. The researches of 

risk perception have been well studied in developed markets for a long time. This study will extend 

previous researches to examine the effect of risk perception on investment decisions in the case of 

emerging market such as Vietnam. Vietnam is a developing country that has the advantage of a stable 

political system and various investment opportunities. However, the majority of individual investors in 

Vietnam still make their investment decisions trending without assessment and perception of the 

potential risks. That is the reason why this study is made to discover the factors that affect their risk 

perception as well as how risk perception affects their investment decisions. Financial investment is 

increasingly popular with Vietnamese people; they do not simply deposit money in the bank and get 

profit from a small interest rate. They have access to other new investment types like stock 

(established in 2007), bond, and mutual fund (established in 2014). The common feature of these 

investment types is higher risk than traditional investment types. However, most individual investors 

haven’t equipped sufficient knowledge and information about risk in investing. This study will help 

investors to have a better understanding of how risk perception affects their investment decision and 

have appropriate action. Different groups in terms of demographic characteristics such as age, gender, 

education background, income, occupation, investment experience, and marital status may have 

different risk perceptions and through this study, they will get some useful information for themselves. 

In addition, there are just a few studies about risk perception and investment decisions of individual 

investors, particularly in Vietnam. Therefore, this study will extend the previous studies to research the 

impact of demographic characteristics include age, gender, income, education, occupation, investment 

experience, and marital status on an individual’s risk perception in Vietnam to contribute to further 



https://www.cribfb.com/journal/index.php/ijfb                       Indian Journal of Finance and Banking                            Vol. 9, No. 1; 2022 
 

21  

researches in the field of financial behavior. This study also helps investment organizations like 

mutual funds, stock companies, brokers understand at a certain degree how demographic factors affect 

investors’ risk perception and to find appropriate investment types for each group of investors. 

 

LITERATURE REVIEW 

Investment decisions could have been influenced by psychological or emotional factors like risk 

perception.  To make an optimized investment decision and avoid repeating their mistakes in the past, 

investors need to understand those factors (Charles & Kasilingam, 2013).There are numerous 

researches which studied the relationship between risk perception and investors’ decisions. Risk 

perception is defined as how investors recognize and assess the potential risk of financial assets, based 

on not only their concerns, experience but also the market situation, expert’s opinion. Baghani and 

Sedaghat (2016) found risk perception and risk tolerance have a direct and positive relationship with 

investors' decisions. Sindhu and Kumar (2014) examined the relationship between individual investors’ 

risk perception and their investment decision in mutual funds and found that investors tend to perceive 

of principle that if they can take a higher risk, they can get a higher return. Simultaneously those 

mutual fund investors tend to agree that diversified portfolios will reduce the risk. Athira and 

Kakkakunnan (2020) found demographic traits of the investors such as gender, occupation, and 

monthly income have a significant effect on their risk-bearing capacity. Additionally, the study of 

Yadav and Narayanan (2021) revealed there is a significant relationship between personality traits and 

investment decision-making. 
Charles and Kasilingam (2013) indicated that behavioral biases are directly influenced by 

demographic characteristics such as age, gender, education, occupation, and income and specifically 

mentioned that age plays a critical role in their behavior and may decide the success of their 

investment decisions. Bashir et al. (2014) also found age has a positive and significant relationship 

with risk perception. However, Sachsea, Jungermanna, and Belting (2012) implied there was a 

significant negative correlation between age and perceived risk. There was a consensus that women 

make more conservative decisions than men when investing. Fisher (2010) showed that females are 

less risk-seeking than males irrespective of familiarity and framing, cost, or ambiguity. Islamoğlu, 

Apan, and Ayvali (2015) studied and sought to understand the patterns of differences in the risk-taking 

habits of men and women. Their studies reaffirmed the result that women significantly differ in their 

investment behaviors than men. Wang, Keller, and Siegrist (2011) revealed that women’s risk 

perception is more than that of men after working and comparing various investment avenues like 

valuable securities, bonds, stocks. In the contrast, Sachsea et al. (2012) revealed there is no significant 

difference between men and women in terms of perceived risk. Bashir et al. (2014) supported income 

level of investors affects their behavior toward investment. Relative risk aversion of persons reduces 

as the income level rises. Gutter and Fontes (2006) stated that education plays an important role in 

risky investment decision. Investors with a higher level of financial knowledge will prefer stock 

equities and with a low level of financial knowledge investors choose a safer option is bank deposits. 

On the contrary, Yao, Sharpe, and Wang (2011) concluded that the general education level of investors 

is not always an effective factor in investment decision.  

Occupation means the activity in which people engaged for pay, it can be a job or profession. 

Those people who work for others and receive monthly salaries tend to take a lower risk level than 

those who generate their income directly from their own business, trade, or profession (Sindhu & 

Kumar, 2014). People with higher ranking occupational status are more risk seekers as compared to 

low ranking occupational status. According to the research of Dhiraj and Mandot (2012), occupations 

and qualifications have a major impact on the investment decisions of investors in Rajasthan (India). 

Experience is a characteristic of perception which is accumulated from similar events, situations, or 

activities in the past. Therefore experienced investors and financial risk perception might differ 

according to the degree of experience that can range from very low to very high. Lodhi (2014) 

surveyed Pakistan to examine the impact of experience and age on the investment decision of 

individual investors. With correlation analysis, the survey’s result suggested that when age and 

experience increase, investors tend to make less risky investments. Aren and Zengin (2016) indicated 



https://www.cribfb.com/journal/index.php/ijfb                       Indian Journal of Finance and Banking                            Vol. 9, No. 1; 2022 
 

22  

that single tend to take more risks than those who are married. According to the study of Islamoğlu et 

al. (2015), marital status has a significant effect on investment decisions. Married investors are 

demonstrating more aggressive investment behavior than single investors and they are more willing to 

take risks than others. 

 

RESEARCH METHODOLOGY 

Hypotheses 

This study was conducted to investigate the effect of demographic characteristics (Age, Gender, 

Income, Education, Occupation, Experience, Marital status) on risk perception and investment 

decision. In addition, this study also examined the relationship between risk perception and investment 

decision. Based on the literature review, the study developed three null hypotheses as follows: 

 

H10:  There is no significant difference between demographic factors and risk perception. 

H20: There is no significant relationship between demographic factors and investment decision. 

H30:  There is no significant relationship between risk perception and investment decision. 

 

Data and Sample 

This study used primary data collected by questionnaire. The questionnaire is adapted from the 

research of Bashir et al. (2014) and Sindhu and Kumar (2014). Participant in this study is individual 

investors including professional investor and non–professional investor in Vietnam. Different 

respondent groups will be chosen to distribute the questionnaire such as university students, employees 

working in investment companies and other industries, service companies, members in professional 

investing groups/forums. The questionnaire was divided into two parts. In the first portion, nine 

statements were designed to identify the risk perception of respondents and its relationship with 

investment. The second portion was designed to collect demographic information. The questionnaire 

was distributed to target respondents by Google survey. Risk perception is defined as the way that 

investors recognize and assess the potential risk of financial assets, based on not only their concerns, 

experience but also the market situation, expert’s opinion. To measure the risk perception of individual 

investors, nine statements were developed based on these factors and the opinions of the respondents 

and measured on a ten-point rating scale. These statements include “my approach is to be cautious and 

avoid all risky investment”; “an investment that involves a great deal of risk is not really investing but 

it is gambling”; “the more money one has, the more investment risk one can take”; “my broker decides 

the best investment level for me”; “the more familiar an investment, the less risky it is”; “a diversified 

portfolio reduces risk”; “the older people take lesser investment risk”; “the need to liquidate quickly 

prohibits me from considering riskier products”; and “the higher an investments' yield or rate of return, 

the greater is its associated risk”. A scale of ten–points designed by decreasing from 10 to 1 was given 

to each statement for the responses from strong agreement to strong disagreement respectively. 

Making investing decisions is related to many aspects of an investment like how much to invest, how 

long to invest, which type of investment, and other concerns. Because of the limitation of time and 

resources, this study only uses the total amount of money invested in stock out of the total investing 

fund to measure investment decision. Stock equity is one of the investment types in which investors 

can get a high return along with high potential risk. 

 

Data Analysis Technique 

This research uses the MANOVA test to discover the effect of demographic factors on multi 

dependent variable–risk perceptions. Multiple regressions test was used to discover the relationship 

between risk perception and investment decision and the effect of demographic factors on investment 

decision. The two-way MANOVA was used to compare the mean differences between groups that 

have been split into two demographic factors (independent variables). The primary purpose of a two-

way MANOVA is to understand if there is an interaction between the two demographic factors on the 

risk perception (dependent variable). Before the statistical analysis, age and experience year are 

grouped. The age of participants is in the range from 20 to 45 years old and it was divided into three 



https://www.cribfb.com/journal/index.php/ijfb                       Indian Journal of Finance and Banking                            Vol. 9, No. 1; 2022 
 

23  

groups: 25 or less: This group includes students and graduate who start working, do not have too much 

experience and high income. 26–30: This group has more working experience (over 3 years) and has a 

higher income and most people in this range of age get married. Over 30: People in this group have a 

more stable income and life. Participants have investing experience from 1 to 10 years, there are a few 

participants who have experience over 5 years, therefore experience variable was divided into three 

groups as below: 1 Year or less: In this stage of investing, people focus on learning experience and 

practicing investing. 2–3 Years: In this stage, people got some experience and invest more skillfully. 

Over 3 years: Investors have accumulated their own experience and have their perception, thinking 

about investment as well as risk. 

Multiple regressions were used to test the relationship between investment decision and 

demographic factors (age, gender, marital status, occupation, education, experience, and income). 

 

Yi = α + β1Agei + β2Genderi + β3Marital Statusi + β4Ocupationi + β5Educationi + β6Experiencei + 

β7Incomei+ i 

 

Y: percentage in stock (investment decision) 

 

To analyze the relationship between risk perception and investment decision, multiple 

regression was conducted with the dependent variable (investment decision) measured by percentage 

in stock and independent variables measured by nine risk perceptions. 

 

Yi = α + β1S1-portfolioi + β2 S2-yieldi + β3 S3-familiari + β4 S4-cautiousi + β5 S5-liquidatei + β6 S6-

moneyi + β7 S7-gamblingi + β8 S8-olderi + β9 S9-brokeri + i 

 

Y: percentage in stock (investment decision) 

 

RESULTS AND DISCUSSIONS 

Descriptive Statistics 

Most of the participants are working and have stable incomes. A total of 167 respondents was 

analyzed in this research. Table 1 showed that the percentage of male and female participants in this 

research is not too different, respectively is 47.9% and 52.1%. The findings showed male participants 

have a higher mean of risk perception and percentage of investing in stock than females. This result 

supported the conclusion of previous researches that men have a higher rate of investing stock than 

women. More than 50% of participants are from 26–30 years old, participants over 30 years old 

account for 26.9% and the rest is 25 years old or less. Participants over 30 years old have the highest 

mean of risk perception and percentage in stock. There is 40.7% of participants are married and 59.3% 

of participants are single, they have a higher mean of risk perception and percentage of investing in 

stock than married participants. Percentages of the three groups of income are not too different, 

investors in the group have income over 15 VND millions have the highest percentage of investing 

stock. The second group has a 13.05 percentage of investing in stock is investors have income from 

10–15 VND millions. Most of the participants have education level are bachelor (62.3%). People with 

education level are college or under college, having the highest mean of risk perception, while people 

with Master’s or Ph.D. degree have the highest mean of the percentage of investing in the stock. 

40.7% of participants invested in stock in one year or less than one year. Participants with over 3 years 

of experience have the highest mean of risk perception and percentage of investing in the stock. 

Participants who work in private and foreign companies account for 41.1%, 31% of participants are 

working in government, 17.4% participants are students and 10.8% participants have their own 

business. Investors who have their own business have the highest mean of investment decision while 

students have the highest mean of risk perception. There is 54.5% of participants send their money in 

bank deposits and 29.3% spend their money on stock equities. Those who invest their money in gold 

have the highest mean of risk perception. 



https://www.cribfb.com/journal/index.php/ijfb                       Indian Journal of Finance and Banking                            Vol. 9, No. 1; 2022 
 

24  

Table 1. Descriptive Statistics of the Respondents  

 

Characteristics Number Percentages 
Mean of risk 

perception 

Mean of 

investing in 

stock (%) 

Gender 

 

Male 80 47.9 7.28 21.81 

Female 87 52.1 7.02 6.92 

Age 

 

25 or less 31 18.6 7.18 6.29 

26-30 91 54.5 6.98 12.99 

Over 30 45 26.9 7.46 21.56 

Marital Status 

 

Single 99 59.3 7.17 13.4 

Married 68 40.7 7.12 15 

Income 

 

Less than 10 

million 
53 31.7 7.04 2.64 

10-15 million 59 35.3 7.26 13.05 

Over 15 million 55 32.9 7.14 26.13 

Education 

 

College or under 21 12.6 7.44 10.24 

Bachelor 104 62.3 7.08 13.41 

Master or PhD 42 25.1 7.16 17.55 

Experience 

 

1 year or less 68 40.7 6.85 3.68 

2 – 3 years 60 35.9 7.27 18.87 

Over 3 years 39 23.4 7.48 24.74 

Occupation 

 

Student 29 17.4 7.38 9.31 

Private company 

employee 
69 41.3 7.11 20.03 

Government 

employee 
51 30.5 7.21 5.29 

Own Business 18 10.8 6.73 23.61 

Type of 

Investing 

 

Gold 16 9.6 6.89 3.44 

Bank deposit 91 54.5 7.15 5.93 

Real Estates 11 6.6 7.56 6.36 

Stock equities 49 29.3 7.14 34.33 

Percentage in 

Investing Stock 

5% or less 92 55.1 6.95 0.05 

6% - 25% 35 21 7.5 14.14 

26% - 45% 17 10.2 7.31 31.88 

Over 45% 23 13.8 7.3 56.74 

Source: Compiled from questionnaire 

 

The risk perception scale was assessed by Cronbach’s Alpha, this is a common measure used to 

determine internal consistency or reliability of a survey with multiple Likert questions, and 10 point 

scales were applied in this survey. The result of Cronbach’s Alpha scale test is 0.878 which was above 

the acceptable minimum of 0.70.Table 2 illustrated the mean and standard deviation for each statement 

of risk perception. The statement “The older people take lesser investment risk” has the highest mean 

of 7.99; this finding implied that participants highly agreed that the older people prefer to take lesser 

investment. And investors also perceive that “An investment that involves a great deal of risk is not 

really investing but it is gambling” which has a mean of 7.47. The statement “My broker decides the 

best investment level for me” has the lowest mean of 6.61 which implied people do not consider a 

broker can decide the best investment for them. 

 

 



https://www.cribfb.com/journal/index.php/ijfb                       Indian Journal of Finance and Banking                            Vol. 9, No. 1; 2022 
 

25  

Table 2. Means of Statements related to Risk Perception  

 

Variables Mean 
Std. 

Deviation 
Statement 

S1-portfolio 7.22 2.349 “A diversified portfolio reduces risk.” 

S2-yield 6.81 2.550 
“The higher an investments' yield or rate of return, the greater is its 

associated risk.” 

S3-familiar 7.41 2.086 “The more familiar an investment, the less risky it is.” 

S4-cautious 6.76 2.462 “My approach is to be cautious and avoid all risky investment” 

S5-liquidate 7.25 2.203 
“The need to liquidate quickly prohibits me from considering 

riskier products.” 

S6-money 6.81 2.461 “The more money one has, the more investment risk one can take.” 

S7-gambling 7.47 2.641 
“An investment that involves a great deal of risk is not investments 

but it is gambling.” 

S8-older 7.99 1.911 “The older people take lesser investment risk.” 

S9-broker 6.61 2.349 “My broker decides the best investment level for me.” 

Risk 

perception 
7.15 1.231 

Mean of nine statements. 

Source: Compiled from questionnaire 

 

Test Hypothesis H10 

To examine the effect of demographic factors on risk perception, two–way MANOVA test was 

conducted in four pairs of demographic factors, they are age and experience, occupation and income, 

education and marital status, as well as gender and income; dependent variables are risk perception. As 

shown in Tables3 and 4, the results of multivariate tests suggested that age, experience, income, and 

occupation have significant effects on risk perception. In addition, there is an interaction effect 

between income and occupation on risk perception. Therefore, null hypothesis one was rejected. The 

finding of this study support demographic factors have significant effects on the perception of risk. 

 

Table 3. Multivariate Tests of Risk Perception by Age and Experience 

 

 Wilks’() = 0. 822 Wilks’() = 0.815 Wilks’() = 0. 807 

 Age group Experience group Age* Experience 

Multivariate 1.717 .036* 1.796 .025* .923 .601 

Univariate F P F P F P 

S1-portfolio .483 .618 1.402 .249 .745 .563 

S2-yield 3.690 .027* 1.256 .288 2.141 .078 

S3-familiar .664 .516 1.018 .364 .809 .521 

S4-cautious 3.457 .034* 1.164 .315 1.585 .181 

S5-liquidate 2.505 .085 .578 .562 .486 .746 

S6-money .968 .382 1.828 .164 1.164 .329 

S7-gambling 1.604 .204 .481 .619 .233 .919 

S8-older 1.336 .266 8.764 .000* .276 .893 

S9-broker 3.691 .027* 4.804 .009* 2.178 .074 

Note. *Significant at 5% level  

Source: Compiled by the authors 

 

 

 

 

 



https://www.cribfb.com/journal/index.php/ijfb                       Indian Journal of Finance and Banking                            Vol. 9, No. 1; 2022 
 

26  

 

Table 4. Multivariate Tests of Risk Perception by Occupation and Income 

 

 Wilks’()= 0.752 Wilks’() = 0.780 Wilks’() = 0.598 

 Occupation Group Income Group Occupation*Income 

Multivariate 1.633 .025* 2.160 .005* 1.481 .016* 

Univariate F P F P F P 

S1-portfolio 3.581 .015* 5.577 .005* 2.398 .030* 

S2-yield 1.495 .218 1.317 .271 .317 .927 

S3-familiar 3.305 .022* 4.181 .017* 3.148 .006* 

S4-cautious .995 .397 3.450 .034* 1.755 .112 

S5-liquidate .722 .540 .762 .468 .566 .757 

S6-money 2.680 .049* 5.962 .003* 1.733 .117 

S7-gambling 1.134 .337 .568 .568 .166 .985 

S8-older .063 .979 .562 .571 1.107 .361 

S9-broker 1.515 .213 .225 .799 1.410 .214 

Note. *Significant at 5% level  

Source: Compiled by the authors 

 

According to the means shown in Table 5, the result implied that younger investors tend to 

disagree with the risk perception “The higher an investments' yield or rate of return, the greater is its 

associated risk”, compared to older ones. The finding also implied that younger ones are new in the 

field of investment and tend to be more cautious, compared to older ones. The result also showed that 

younger investors tend to agree with the risk perception “My broker decides the best investment level 

for me”, compared to older ones.  This finding implied that younger investors with less experience and 

skill believe that brokers will help them decide the best and profitable investment. The finding also 

implied that investors with shorter experience years tend to disagree with the risk perception “The 

older people take lesser investment risk”, compared to those with longer experience years. The result 

also showed that investors with longer experience years tend to be more cautious in their investment 

decisions, compared to the investors with shorter experience years. The result may imply that the 

longer experience years make investors more understand about risk and become more careful when 

making an investment decision.   

 

Table 5. Mean of Age and Experience to Risk Perception 

 

Risk Perception 
Age Group Experience 

25 OR LESS 26-30 OVER 30 1Y OR LESS 2Y-3Y OVER 3Y 

S1-portfolio 6.9 7.16 7.53 6.9 7.1 7.79 

S2-yield 6.00 6.92 7.16 6.54 6.82 7.28 

S3-familiar 7.29 7.38 7.56 7.28 7.45 7.59 

S4-cautious 7.87 6.11 6.51 7.01 6.73 6.36 

S5-liquidate 7.48 6.91 7.78 6.96 7.45 7.46 

S6-money 6.32 6.52 7.76 6.26 6.93 7.59 

S7-gambling 7.74 7.04 8.16 7.22 7.33 8.13 

S8-older 8.00 7.79 8.38 7.10 8.6 8.59 

9-broker 7.03 6.6 6.33 6.4 6.93 6.49 

Source: Compiled by the authors 

 

Based on the means shown in Table 6, the result implied that investors such as students tend to 

diversify their portfolios to reduce risk, and private and foreign company employees believe that the 

more familiar an investment, the less risky it is, compared to investors who run a business. The result 



https://www.cribfb.com/journal/index.php/ijfb                       Indian Journal of Finance and Banking                            Vol. 9, No. 1; 2022 
 

27  

also showed government employees tend to agree with the risk perception “The more money one has, 

the more investment risk one can take”, compared to those who run their own business. This finding 

implied that if investors who work in government tend to take more risk in investing if they have more 

capital. According to furthermore analysis on the effect of income, the result implied that investors 

with higher income tend to agree with the risk perception “A diversified portfolio reduces risk”, 

compared to those who have lower income. The finding implied that the investors who have higher 

income tend to believe that the more familiar an investment, the less risky it is, compared to those who 

have lower income. The result also showed that investors with lower income tend to be more cautious 

in their investment decisions, compared to the investors who have higher income. The finding implied 

that investors with lower income levels will be more cautious in making an investment decision 

because if the result of the investment is a loss that may destroy their life. The results also showed that 

investors with higher income tend to agree with the risk perception “The more money one has, the 

more investment risk one can take”, compared to those who have lower income. The result shown in 

Table 7implied when income levels increase, investors tend to agree that a diversified portfolio can 

help them reduce risk. The results also indicated that when income levels increase, private and foreign 

company employees tend to agree with the risk perception “The more familiar an investment, the less 

risky it is”, however, investors such as students were discovered on the opposite side. 

 

Table 6. Mean of Occupation and Income to Risk Perception 

 

Risk 

perception 

Occupation Income 

Student 

Private and 

foreign 

company 

employee 

Government 

employee 

Own 

business 
less than 

10VND 

million 

10-15 

VND 

million 

over 

15 

VND 

million 

S1-

portfolio 
8.07 7.45 6.65 6.56 6.6 7.39 7.62 

S2-yield 7.34 7.28 5.78 7.11 6.02 6.86 7.53 

S3-familiar 7.52 7.58 7.31 6.89 7.4 7.07 7.8 

S4-

cautious 
7.14 6.52 7.29 5.56 7.34 7.00 5.95 

S5-

liquidate 
7.03 7.3 7.55 6.56 7.19 7.44 7.11 

S6-money 6.86 6.8 7.02 6.22 6.08 6.98 7.35 

S7-

gambling 
7.97 6.9 8.02 7.33 7.85 7.69 6.87 

S8-older 7.97 7.99 7.98 8.06 7.89 8.24 7.82 

9-broker 6.52 6.22 7.29 6.33 7.02 6.63 6.2 

Source: Compiled by the authors 

 

Table 7. Mean of an Interaction effect between Income and Occupation 

 

Risk 

perception 
Occupation Income 

S1-portfolio 

 
less than 10VND 

millions 

10-15 VND 

millions 

over 15 VND 

millions 

Student 7.8 8.08 8.43 

Private and foreign 

company employee 
7.67 7.38 7.42 

Government employee 6.30 6.94 7.33 

Own business 2.50 7.33 7.82 



https://www.cribfb.com/journal/index.php/ijfb                       Indian Journal of Finance and Banking                            Vol. 9, No. 1; 2022 
 

28  

S3-familiar 

Student 8.30 7.17 7.00 

Private and foreign 

company employee 
7.42 7.5 7.71 

Government employee 7.48 6.89 7.83 

Own business 4.5 4.0 8.55 

Source: Compiled by the authors 

 

Test Hypothesis H20 

The result of regression analysis in Table 8 showed that R2
=0.592 and gender, experience years, and 

income level have statistically significant effects on investment decision. The estimated parameter of 

gender is significantly negative and experience and income have a positive sign.  Therefore, null 

hypothesis two is rejected. There is a significant relationship between demographic factors (gender, 

investing experience year, and income level) and investment decision. According to the results of 

further analysis by ANOVA, males have a higher mean percentage in stock than females at all income 

levels. The finding supported that men are more risk-taking than women in their attitudes and 

behaviors toward investment decisions. Investors with higher income levels tend to invest more capital 

in stock, compared to those with lower income levels. The results also showed that individual 

investors with more investing experience tend to invest a higher percentage of their total fund in stock 

than those with less investing experience. 

Based on the results shown in Table 8, the general form of regression model predicting the 

relationship between demographic characteristics and investment decision can be described as follows: 

 

Y = 6.626-8.511Gender + 1.819Experience +6.763Income 

 

Y: percentage in stock (investment decision) 

 

Table 8. Regression Analysis of Demographic Factors and Investment Decision 

 

Model Unstandardized 

Coefficients 

Standardized 

Coefficients 

t Sig. 

B Std. Error Beta 

(Constant) 6.626 12.886  .514 .608 

AGE -.130 .491 -.032 -.266 .791 

GENDER -8.511 2.956 -.210 -2.879 .005* 

MARITAL 

STATUS 
-5.524 3.700 -.134 -1.493 .137 

OCCUPATION -.122 1.652 -.005 -.074 .941 

EDUCATION -.072 2.521 -.002 -.029 .977 

EXPERIENCE 1.819 .770 .250 2.363 .019* 

INCOME 6.763 1.749 .312 3.866 .000* 

R2
 = 0.592      

Note. *Significant at 5% level /-**+-8 

Source: Compiled by the authors 

 

Test Hypothesis H30 

The result of regression analysis in Table 9 showed that R2
=0.62.  Risk perceptions (S4-cautious, S8-

older, and S9-broker) have statistically significant effects on investment decisions. The estimated 

parameter of S4-cautious and S9-broker is significantly negative while S8-older has a positive sign. 

Risk perception “my approach is to be cautious and avoid all risky investment” had a negative 

relationship with an investment decision, which means the more investors agree with this statement, 

the less they invest in stock. Risk perception “the older people take lesser investment risk” had a 



https://www.cribfb.com/journal/index.php/ijfb                       Indian Journal of Finance and Banking                            Vol. 9, No. 1; 2022 
 

29  

positive relationship with an investment decision, which means investors who agree with this 

statement tend to invest more capital in stock. Finally, Risk perception “my broker decides the best 

investment level for me” showed a negative relationship with investment decision; this result implied 

that investors who disagree with this statement tend to invest a lot of their funds in stock.  Therefore, 

null hypothesis three is rejected. There is a significant relationship between risk perception and 

investment decision. The finding supports the study of Prabhakaran and Karthika (2011), which 

indicated that the risk perception of investors is an essential factor that influences investment 

decisions. 

Based on the results shown in Table 9, the general form of regression model predicting the 

relationship between risk perception and investment decision can be described as follows: 

 

Y = 7.442– 2.869CAUTIOUS + 1.773OLDER – 2.415BROKER 

 

Y: percentage in stock (investment decision) 

 

Table 9. Regressions Analysis for Risk Perception and Investment Decision 

 

Model 

Unstandardized 

Coefficients 

Standardized 

Coefficients t Sig. Risk perception 

B Std. Error Beta 

(Constant) 7.442 8.496  .876 .382  

S1-

portfolio 
.983 .692 .114 1.421 .157 A diversified portfolio reduces risk. 

S2- 

yield 
.745 .591 .093 1.261 .209 

The higher an investments' yield or rate 

of return, the greater is its associated 

risk. 

S3-

familiar 
.374 .688 .038 .543 .588 

The more familiar an investment, the 

less risky it is. 

S4-

cautious 
-2.869 .584 -.348 -4.917 .000* 

My approach is to be cautious and 

avoid all risky investment 

S5-

liquidate 
1.439 .766 .156 1.878 .062 

The need to liquidate quickly prohibits 

me from considering riskier products. 

S6- 

money 
.224 .714 .027 .313 .755 

The more money one has, the more 

investment risk one can take. 

S7-

gambling 
.121 .600 .016 .202 .840 

An investment that involves a great deal 

of risk is not really investing but it is 

gambling. 

S8- 

older 
1.773 .865 .167 2.051 .042* 

Older people take lesser investment 

risks. 

S9- 

broker 
-2.415 .651 -.279 -3.706 .000* 

My broker decides the best investment 

level for me. 

R2 = 0.62   

Note. *Significant at 5% level  

Source: Compiled by the authors 

 

CONCLUSION AND RECOMMENDATIONS 

In order to have a comprehensive and insightful study of the relationship among demographic profile, 

risk perception, and investment decision, this research extends previous researches with the case of 

Vietnam. The research tried to get reach of people in various educations, occupations, ages, and 

incomes to have a more general status of investing in Vietnam. The analysis results of this research 

show that demographic factors such as age, income, occupation, and investing experience have 



https://www.cribfb.com/journal/index.php/ijfb                       Indian Journal of Finance and Banking                            Vol. 9, No. 1; 2022 
 

30  

significant effects on the risk perception of investors, which was consistent with the findings of Bashir 

et al. (2014) that demographic characteristics (age, gender, and income), except education, affect risk 

perception. The result further discovers that gender, income, and investing experience have a 

significant relationship with investment decision, which is similar to the finding of Patel and Modi 

(2017). The result also reveals that there is a relationship between risk perception and investment 

decision, which supported the finding of Bairagi and Chakraborty (2018) that psychological or 

emotional factors like risk perception have effects on investment decision. The findings of this study 

provided various effects of demographic characteristics on risk perception as well as investment 

decision, which have practical implications for mutual funds, financial advisors, bankers, and 

individual investors. 

 

REFERENCES 

Abdeldayem, M. M. (2015). The impact of investors’ perception of risk on portfolio management: 

Evidence from the Kingdom of Bahrain. Applied Science University, 6(12), 33-38. 

 

Athira, K., & Kakkakunnan, M. K. (2020). Impact of Demographic Traits and Personality Traits of 

Investors on Their Risk-Bearing Capacity: A Study with Special Reference to Investors of 

Kerala. Indian Journal of Finance and Banking, 4(2), 64-78. 

 

Aren, S., & Zengin, A.N. (2016). Influence of financial literacy and risk perception on choice of 

investment. Social and Behavioral Sciences, 235, 656-663. 

https://doi.org/10.1016/j.sbspro.2016.11.047 

 

Baghani, M. R., & Sedaghat, P. (2016). Effect of risk perception and risk tolerance on investors' 

decision making in Tehran stock exchange. International Academic Journal of Accounting & 

Financial Management, 3(9), 45-53. 

 

Bairagi, P., & Chakraborty, A. (2018). Influence of risk perception on retail investors’ decision 

making. Asian Journal of Management, 9(2), 999-1004. https://doi.org/10.5958/2321-

5763.2018.00157.9 

 

Bashir, T., Shaheen, S., Batool, Z., Butt, M.H., & Javed, A. (2014). The impact of demographic 

characteristics and risk tolerance on investors’ risk perception and portfolio management. The 

Lahore Journal of Business, 2(2), 33-48.  https://doi.org/ 10.35536/ljb.2014.v2.i2.a2 

 

Charles, A., & Kasilingam, R. (2013). Does the investor's age influence their investment behaviour? 

Sage Journals, 17(1-2), 11-24 

 

Dhiraj, J., & Mandot, N. (2012). Impact of demographic factors on investment decision of investors in 

Rajasthan. Journal of Arts, Science & Commerce, 2(3), 81-92. 

 

Fisher, P.J. (2010). Gender differences in personal savings behaviors. Journal of Financial 

Counseling and Planning, 21(1), 14-24. 

 

Gutter, M. S., & Fontes, A. (2006). Racial differences in risky asset ownership: A two-stage model of 

the investment decision-making process. Financial Counseling and Planning, 17(2), 64-78. 

 

Islamoğlu, M., Apan, M., & Ayvali, A. (2015). Determination of factors affecting individual investor 

behavior: A study on bankers. International Journal of Economics and Financial Issues, 5(2), 

531-535. 

 



https://www.cribfb.com/journal/index.php/ijfb                       Indian Journal of Finance and Banking                            Vol. 9, No. 1; 2022 
 

31  

Lodhi, S. (2014). Factors influencing individual investor behavior: an empirical study of city Karachi. 

Journal of Business and Management, 16(2), 68-76. 

 

Patel, B., & Modi, V. (2017). Impact of demographic factors on investment decision: an empirical 

study from South Gujarat Region. International Journal of Latest Engineering and 

Management Research, 2(12), 31-38. 

 

Prabhakaran, K., & Karthika, P. (2011). A study on risk perception and portfolio management of 

equity investors in Coimbatore city. Journal of Management and Science, 1–13. 

 

Raiz, L., Hunjra, A.I., & Azam, R. (2012).  Impact of psychological factors on investment decision 

making mediating by risk reception: A conceptual study. Middle East Journal of Scientific 

Research, 12(6), 789-795.  

 

Rohrmann, B. (1999). Risk perception research: Review and documentation. Research Center 

Juelich. 

 

Sachsea, K., Jungermanna, H., & Belting, J. M. (2012).  Investment risk – The perspective of 

individual investors. Journal of Economic Psychology, 33, 437-447. 

 

Sindhu, K. P., & Kumar, S. M. (2014). Influence of risk perception of investors on investment 

decisions: An empirical analysis. Journal of Finance and Bank Management, 2(2), 15-25. 

 

Wang, M., Keller C., & Siegrist, M. (2011). The less you know, the more you are - afraid of a survey 

on risk perceptions of investment products. The Journal of Behavioral Finance, 12(1), 9-19. 

 

Yadav, A., & Narayanan, G. B. (2021). Do personality traits predict biasedness while making 

investment decisions? International Journal of Accounting & Finance Review, 6(1), 19-33. 

https://doi.org/10.46281/ijafr.v6i1.939 

 

Yao, R., Sharpe, D.L., & Wang, F. (2011). Decomposing the age effect on risk tolerance. The Journal 

of Socio-Economics, 40(6), 879-887.  

 

Yuliani, Y., Isnurhadi, I., & Jie, F. (2017). Risk perception and psychological behavior of investors in 

emerging market: Indonesian Stock Exchange. Investment Management and Financial 

Innovations, 14(2-2), 347-358. http://dx.doi.org/10.21511/imfi.14(2-2).2017.06 

 

                                             AUTHOR CONTRIBUTIONS 

Conceptualization: Shu-Hui Su 

Data Curation: Shu-Hui Su 

Formal Analysis: Shu-Hui Su  

Funding Acquisition: Hsiu-Ling Lee 

Investigation: Shu-Hui Su 

Methodology: Shu-Hui Su 

Project Administration: Hsiu-Ling Lee, Yao-Ling Liu  

Resources: Shu-Hui Su 

Software: Tran Thi Kim Quy 

Supervision: Hsiu-Ling Lee  

Validation: Yao-Ling Liu  

Visualization: Hsiu-Ling Lee, Tran Thi Kim Quy  

Writing – Original Draft: Shu-Hui Su 

Writing – Review & Editing: Shu-Hui Su, Hsiu-Ling Lee  



https://www.cribfb.com/journal/index.php/ijfb                       Indian Journal of Finance and Banking                            Vol. 9, No. 1; 2022 
 

32  

 

CONFLICT OF INTEREST STATEMENT 

The authors declare that they have no competing interests.  

 

ACKNOWLEDGMENTS 
All authors contributed equally to the conception and design of the study. 

 

Copyrights 

Copyright for this article is retained by the author(s), with first publication rights granted to the 

journal. This is an open-access article distributed under the terms and conditions of the Creative 

Commons Attribution license (https://creativecommons.org/licenses/by/4.0) 

 


