THE IMPACT OF BEHAVIORAL BIASES ON INVESTMENT PERFORMANCE: DOES FINANCIAL LITERACY MATTER?

This paper aims to investigate the impact of behavioral biases and financial literacy on investment performance in an emerging stock market context. Based data collected from a sample 196 Moroccan investors operating Casablanca exchange, we test research hypotheses using structural equation modeling. Out four heuristics examined our proposed conceptual framework (i.e. overconfidence, representativeness, anchoring herding), only overconfidence representativeness had significant positive performance. Our results also suggest while it was found negatively associated with overconfidence. is first its kind existence African, Arab market. As well, current study among earliest attempts examine how relate performance.Keywords: Heuristics; literacy; performance; market; SEM.JEL Classification: G02.DOI: https://doi.org/10.32479/ijefi.11318