Factors Influencing Students Investment Decisions in the Capital Market

Abstract

This study aims to analyze the influence of risk perception, risk tolerance, initial capital, environment, and social media on students' investment decisions in the capital market. The research uses a quantitative approach with a survey method through the distribution of questionnaires to 90 selected student respondents using purposive sampling techniques. Data analysis was carried out using Structural Equation Modeling based on Partial Least Square (SEM-PLS). The results of the study showed that risk perception, risk tolerance, initial capital, and environment did not have a significant effect on students' investment decisions. On the other hand, social media has a positive and significant influence and is a dominant factor that influences investment decisions. These findings show that in the digital era, information and influence obtained through social media determine student investment behavior more than traditional psychological and economic factors. The novelty of this research lies in the simultaneous testing of psychological, economic, social, and digital factors in explaining students' investment decisions in Indonesia. The results of the research are expected to contribute to the development of digital media-based investment literacy and education among students.