The Effect of Demographic Characteristics on the Relationship between Sentiment and Risk Appetite of Individual Investors at Nairobi Securities Exchange


  • Kitonyi Saiti University of Nairobi
  • Cyrus Iraya Mwangi University of Nairobi
  • Kennedy Okiro University of Nairobi
  • Kamau Gathiaka University of Nairobi



The effect of demographic characteristics in the market and how it influences investor sentiment and risk appetite is a concept that has not been exhaustively investigated. Moreover, most of the reviewed literature, investigated the moderating influence of demographic characteristics but not the moderated mediation effect. Hence, the objective of the study was to determine the effect of demographic characteristics in the relationship between investor sentiment and risk appetite. Demographic characteristics like age or experience could influence sentiments such as fear, joy or sadness that an investor manifests in the market and thus affect performance. The study adopted a positivistic approach since it wanted to get insights into a phenomenon. In addition, a correlational descriptive survey was deemed appropriate because the study was about investigating the relationship between variables. This implies that primary data was collected from individual investors at NSE using a structured questionnaire and the response rate was 70.3%. ANOVA and stepwise regression were used to examine the moderated mediation effect of demographic characteristics on the relationship between investor sentiment and risk appetite. Moderated mediation occurs when the moderating term impacts the link between the independent and mediating variable meaning that the relationship is not bivariate. The outcome of the study revealed that the coefficient tests were not significant and therefore the study concluded that demographic characteristics did not have a moderated mediation effect.

Keywords: Demographic Characteristics, Investor Sentiment, Risk Appetite, Individual Investors, Moderated Mediation

Author Biographies

Kitonyi Saiti, University of Nairobi

University of Nairobi

Cyrus Iraya Mwangi, University of Nairobi

University of Nairobi

Kennedy Okiro, University of Nairobi

University of Nairobi

Kamau Gathiaka, University of Nairobi

University of Nairobi


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How to Cite

Kitonyi , S., Mwangi, C. I., Okiro, K., & Gathiaka, K. (2023). The Effect of Demographic Characteristics on the Relationship between Sentiment and Risk Appetite of Individual Investors at Nairobi Securities Exchange. Journal of Finance and Accounting, 7(4), 87–102.