Analysis of Trading Behaviors of Investors with Compulsive Gambling Symptoms
Aditya Putra Angkasa, Dony Abdul Chalid

Universitas Indonesia

Abstract

The growing popularity of stock market trading in recent years has attracted numerous investors to try their luck in the financial markets. Some investors use the stock market as a substitute for gambling, which is considered an illegal activity in Indonesia. This study investigates the existence and prevalence of compulsive gambling in the Indonesian financial markets. We then test if it is associated with more frequent and speculative trading behaviours, such as higher stock trading frequency, day trading behaviour, and investing in leveraged and other derivative products using logistic regression. Data is gathered in a questionnaire distributed to Indonesian investors, based on a standard diagnostic checklist from the American Psychiatric Association to screen for compulsive gambling behaviour. Investors with compulsive gambling symptoms tend to have a more speculative trading style and trade more actively, supported by their frequency of trades and investing in leveraged products and derivatives.

Keywords: trading behavior, compulsive gambling, investors

Topic: Management