Investigation of the effects of confidence and expectation indices on investment decisions in behavioral finance perspective

In this study, the effects of macroeconomic indicators related to confidence and expectation, which are important factors affecting investor sentiment, on investment decisions are examined. In the sample of the study, the United States of America as a developed country and Turkey as a developing country were taken. In the study, firstly, evaluations were conducted with multiple linear regression models for return and change values of investment instruments, and then generalized autoregressive conditional heteroskedasticity models were used for the evaluations of the volatility of investment instruments. As dependent variables, stock market index return values (BIST 100 and S&P500) and change in total local currency deposits were used for both countries. As independent variables, consumer confidence index, economic confidence index, total confidence index for both countries and VIX Fear Index were included in the analysis. The dataset is handled on a monthly basis and consists of the data between December 2012 and April 2022 as a time interval. As a result of the average estimation models, it has been observed that the independent variables generally have an effect on investments for both countries. As a result of the volatility estimation models, no independent variable was found to have an effect on the BIST 100 index investments, while the variables related to expectation and confidence had significant effects on the other three investment instruments.