The Impact of Financial Literacy on Investment Decision-Making Among Individual Investors in the Nigerian Capital Market

• Author(s): Sunday Emmanuel Osemeahon ; Dr. Oladimeji Johnson. A ; Imarayi Praise Osaremen ; Onyia Chibuike
• Paper ID: 1710631
• Page: 926-931
• Published Date: 18-09-2025
• Published In: Iconic Research And Engineering Journals
• Publisher: IRE Journals
• e-ISSN: 2456-8880
• Volume/Issue: Volume 9 Issue 3 September-2025

Abstract

This study examines the impact of financial literacy on investment decision-making among individual investors in the Nigerian capital market. Despite the importance of the Nigerian Capital Market in promoting economic growth, retail investor participation remains relatively low, largely due to inadequate financial knowledge. The study explores how financial literacy influences investment behaviors and the quality of investment decisions. A quantitative research design was employed, utilizing a cross-sectional survey to collect data from 423 respondents. Descriptive statistics, Pearson’s correlation, and multiple regression analysis were used to analyze the data. The results reveal a significant positive relationship between financial literacy and investment decisions (r = 0.713, p < 0.01). The regression analysis further confirms that financial literacy significantly predicts investment decisions (? = 0.148, p = 0.001). These findings underscore the crucial role of financial literacy in improving investor behavior and promoting greater market participation in Nigeria. The study concludes that enhancing financial literacy could empower Nigerian investors, leading to more informed decisions and improved market outcomes. The research also recommends the implementation of comprehensive financial literacy programs tailored to the needs of retail investors in Nigeria.

Keywords

Financial Literacy, Investment Decision-Making, Nigerian Capital Market, Retail Investors.

Citations

IRE Journals:
Sunday Emmanuel Osemeahon , Dr. Oladimeji Johnson. A , Imarayi Praise Osaremen , Onyia Chibuike "The Impact of Financial Literacy on Investment Decision-Making Among Individual Investors in the Nigerian Capital Market" Iconic Research And Engineering Journals Volume 9 Issue 3 2025 Page 926-931

IEEE:
Sunday Emmanuel Osemeahon , Dr. Oladimeji Johnson. A , Imarayi Praise Osaremen , Onyia Chibuike "The Impact of Financial Literacy on Investment Decision-Making Among Individual Investors in the Nigerian Capital Market" Iconic Research And Engineering Journals, 9(3)