An analysis of Decision Making in the Stock Investment

  • Yuniningsih Yuniningsih University of National Development “Veteran” East Java, Surabaya
  • Sugeng Widodo University of Wijaya Kusuma, Surabaya Indonesia
  • Muh. Barid Nizarudin Wajdi STAI Miftahul Ula Nganjuk
Keywords: decision making, investment, loss aversion, risk taking.


The research objective is to test how much risk investors are willing to take when making their investment associated with the loss aversion, in terms of the risk taking behavior in relation with that of the loss aversion. The later, the loss aversion is treated as the independent variable reviewed from the two sides of the gain and loss domain. When investors are in loss aversion within the gain domain, they tend to have a lower risk taking behavior than that of the loss domain. Such tendency of investor’s behavior differences in those two different domains is described in a hypothetical value function (Kahneman and Tversky, 1979). ANOVA Test is applied to determine the risk taking behavioral differences in the two domains toward the loss aversion. Hypothesis test results with the alpha index indicate that investors, when in the loss aversion of the gain domain, have a lower risk taking than that of the loss aversion in the loss domain. Meanwhile, using post hoc for significant test results in that the loss aversion has a significant influence for the risk taking decision making in investment, particularly in that of the stocks.


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How to Cite
Yuniningsih, Y., Widodo, S., & Nizarudin Wajdi, M. B. (2020). An analysis of Decision Making in the Stock Investment. Economic: Journal of Economic and Islamic Law, 8(2), 122-128. Retrieved from