Loading...
Paper Type
Complete
Paper Number
1274
Description
Investing money set aside in stocks or funds is becoming increasingly attractive as central banks hardly pay any interest. A recent trend shows that retail investors are investing in exchange-traded funds (ETFs), because they enable risk diversification and require little administrative effort, so that even experienced retail investors are switching from stocks to ETFs. To explain this behavior, we draw on migration theory and conduct a qualitative study. Our results suggest that such switches are based on five perceptions, characterized as pull, push, and mooring factors and that two different patterns of switching behavior exist. We contribute to research on IT-enabled investments by (1) showing that context-specific perceptions, such as perceived risk reduction, influence retail investors’ switching behavior to ETFs, (2) highlighting that these perceptions let some retail investors invest in stocks and ETFs in parallel, and (3) explaining why experienced retail investors switch to ETFs.
Recommended Citation
Meier, Marco and Maier, Christian, "Exchange Traded Funds (ETFs): A qualitative study explaining retail investors’ switching behavior to IT-enabled investments" (2021). AMCIS 2021 Proceedings. 7.
https://aisel.aisnet.org/amcis2021/adopt_diffusion/adopt_diffusion/7
Exchange Traded Funds (ETFs): A qualitative study explaining retail investors’ switching behavior to IT-enabled investments
Investing money set aside in stocks or funds is becoming increasingly attractive as central banks hardly pay any interest. A recent trend shows that retail investors are investing in exchange-traded funds (ETFs), because they enable risk diversification and require little administrative effort, so that even experienced retail investors are switching from stocks to ETFs. To explain this behavior, we draw on migration theory and conduct a qualitative study. Our results suggest that such switches are based on five perceptions, characterized as pull, push, and mooring factors and that two different patterns of switching behavior exist. We contribute to research on IT-enabled investments by (1) showing that context-specific perceptions, such as perceived risk reduction, influence retail investors’ switching behavior to ETFs, (2) highlighting that these perceptions let some retail investors invest in stocks and ETFs in parallel, and (3) explaining why experienced retail investors switch to ETFs.
When commenting on articles, please be friendly, welcoming, respectful and abide by the AIS eLibrary Discussion Thread Code of Conduct posted here.