Testing behavioral finance trends on capital markets

Finance refers to the procurement of the required funds at appropriate costs and their successful management. Today, finance has undergone various expansions beyond this classical definition and approach. It has not only encompassed the management expressed here but has also formed tight relationships with other social science fields. One of these expansions, or a criticism of classical finance, is Behavioral Finance, which is described as an area that attempts to explain financial decisions influenced by individual investors' cognitive, emotional, and social tendencies and behaviors. It is a research area that generally examines what investors consider during investment decisions, investigates what influences them in terms of risk and return, and draws on other sub-disciplines such as psychology, sociology, and neuroscience in doing so. This study investigated the behavioral finance tendencies influencing the investment decisions of investors in Bolu province. For this purpose, a survey was conducted with 307 participants in Bolu province. All adults with the capacity and inclination to invest were randomly included in the survey. The obtained data were analyzed using the SPSS statistical program. The statistical results of the responses to the survey were obtained, and first, demographic and financial characteristics, and then the cognitive, emotional, and sociological behavioral finance tendencies of investors were analyzed. In the analysis results, it was found that investors in Bolu province exhibited tendencies of Overconfidence, Overoptimism, Preference for the Familiar, and Herd Behavior intensively while making financial decisions.