A Study of the Influencing Factors of Personal Investment Decision: A Case of Financial Knowledge Among Young Investors in China

Abstract

In the context of China’s rapidly expanding retail investment market, understanding the factors that shape individual investment behavior has become increasingly important. Young and middle-aged investors, in particular, are active participants in digital financial platforms, yet their investment decisions are influenced by varying levels of financial knowledge, psychological tendencies, and behavioral characteristics. This study aims to examine the impact of financial knowledge, risk preference, and investment self-efficacy on the personal investment decisions of investors in China.
A quantitative research design was employed, and data were collected through an online questionnaire distributed using a random sampling approach. A total of 380 questionnaires were distributed, and 300 valid responses were retained for analysis. The study utilized descriptive statistics, reliability and validity testing, correlation analysis, and multiple regression analysis to evaluate the relationships among the key variables.
The findings reveal that all three factors—financial knowledge, risk preference, and investment self-efficacy—have significant positive effects on personal investment decisions. Among them, investment self-efficacy emerged as the strongest predictor, followed by risk preference and financial knowledge.
This study contributes to the literature by providing empirical evidence from a developing-market context and offers practical implications for policymakers, financial institutions, and individual investors seeking to enhance financial decision-making and promote healthier investment behavior.

Keywords: financial knowledge, risk preference, investment self-efficacy, personal investment decision