Behavioral Finance: An Empirical Study of the Tunisian Stock Market

Mustapha Chaffai, Imed Medhioub


Behavioral finance attempts to give some explanations to the psychological and emotional factors involved in the stock market and that affect the behavior of investors and the market efficiency. In this paper we study the influence of these psychological and emotional factors on the behavior of Tunisian stock market investors. Based on a questionnaire distributed to the Tunisian investors in the stock market, and by using the Multiple Correspondence analysis, we focus to explain how the behavioral finance can affect Tunisian stock market. We conclude that persons having a high level of education are subject to behavioral biases, and agents who invest amounts between 1,000 and 20,000 TND are most vulnerable to behavioral biases. And then we can say that information on the market cannot lead to the market efficiency.

Keywords: Behavioral finance; efficient market; psychological biases; Tunisian stock market;

Multiple correspondence analysis.

JEL Classifications: G11; G12; G14; G30.

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