Impact of Social and Psychological Factors on Herding Behavior Investors in 
Iran Stock Market

Mozaffary, Abbas; Foroughi Abari, Meysam; Nikzad Chaleshtari, Ghodratallah

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year 17, Issue 67 (2025)

fa 2025, 17(67): 35-55

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Impact of Social and Psychological Factors on Herding Behavior Investors in Iran Stock Market

Abbas Mozaffary¹

, Meysam Foroughi Abari ^*¹

, Ghodratallah Nikzad Chaleshtari¹

1- Department of Accounting, Mo.C., Islamic Azad University, Isfahan, Iran.

Abstract: (24 Views)

Behavioral finance, as an alternative to the Efficient Market Hypothesis, explains the herding behavior of investors in financial markets. Under the influence of certain factors, market participants often abandon their own beliefs and follow the prevailing market consensus. This phenomenon leads to instability and fragility in stock markets and results in inefficient financial systems by driving prices away from their fundamental values. This study aims to investigate the impact of social factors including age, gender, education, occupation, and experience in the stock market and psychological factors such as emotions, fear, and cognitive biases on herding behavior among investors. This investigation is conducted through eight hypotheses. The statistical population is the Tehran Stock Exchange activists, the opinions of 385 of whom were collected as a random sample through a questionnaire and analyzed using Minitab 22 software and one-sample t-tests, proportion, and Fisher's exact test. The findings decisively confirm all eight hypotheses, indicating that the aforementioned social and psychological factors significantly influence herding behavior among investors and these factors give rise to herding behavior and should be considered parallel to classical financial models in financial markets.

Article number: 3

Keywords: Efficient Market, Herding Behavior, Social and Psychological Factors, Stock Market.

Full-Text [PDF 1233 kb] (27 Downloads)

Type of Study: Research | Subject: Special

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Mozaffary A, Foroughi Abari M, Nikzad Chaleshtari G. Impact of Social and Psychological Factors on Herding Behavior Investors in Iran Stock Market. fa 2025; 17 (67) : 3
URL: http://qfaj.mobarakeh.iau.ir/article-1-2874-en.html

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