Do Brand Familiarity, Perceived Trust and Attitude Predict Stock Investment Decision Behavior

Abstract

Over the years, the extant literature has investigated the influence of behavioral factors on investor decision-making. This study aims to further the research on behavioral aspects and investigate the effect of brand familiarity on investor’s investment decision in stocks. Specifically, the study tests the mediating role of perceived trust and attitude between brand familiarity and investment decision of retail investors in the Malaysian stock exchange. Structural equation modeling was used to test the proposed hypothesis by using the data of 247 retail stock investors. The study results indicate that perceived trust and attitude mediate the relationship between brand familiarity and investment decision. The direct relationship between brand familiarity and investment decision is not established. The result provides new theoretical insight and implications for the management as trust and a positive attitude can be created by enhancing brand familiarity, which influences stock investment decision.