Behavioral Factors on Individual Investors' Decision Making and Investment Performance: A Survey from the Vietnam Stock Market

The stock market shows the current health of an economy, and investment performance represents it. This study aims to clarify the relationship between financial behavior and investment decisions as well as its impact on investment results. Determine the influence of behavioral factors on individual investors' investment decisions and investment performance on the Vietnam stock market. The study surveyed 250 investors. The main analytical methods used are Exploratory Factor Analysis (EFA), Confirmatory Factor Analysis (CFA), and Structural Equation Modeling (SEM). Research results show that Heuristic, Prospect, Market, and Herding directly and positively affect investment decision-making. Besides, the above factors have a direct and positive effect on investment performance. In particular, the Prospect factor has the strongest influence on investment decision-making and investment performance. The major findings of this study suggested that the important role of Heuristic, Prospect, Market, and Herding on Investment Decision-making and Investment Performance. Prospect had the strongest impact on Investment decision-making (beta = 0.275). Heuristic had the second strongest impact (beta = 0.257), then Herding (beta = 0.202), and finally Market (beta = 0.189) had the weakest effect. Regarding Investment Performance, the Prospect factor has a higher degree of impact than Heuristic Herding and Market.