AI in Employment: Threats or Opportunity? An Analysis of Global Trends, Sectoral Impacts, and Policy Responses

Abstract

The study focuses on personality traits that affect the risk taking behaviour of investors. We focus on the Big Five personality traits which are represented by the acronym OCEAN: Openness (O) measures creativity, curiosity and willingness to try new things; Conscientiousness (C) measures organization, responsibility and goal-oriented behaviour; Extraversion (E) measures sociability, assertiveness, and energy levels; Agreeableness (A) measures kindness, trust, and cooperation; and Neuroticism (N) measures emotional stability, anxiety, and propensity for stress. The main objective of the study is to find out whether there is any relation between Big Five personality traits and risk taking behaviour. The study is based entirely on secondary data collected from reliable academic sources. The study compares the personality traits of the investor and the amount of risk he takes while investing. This research paper analyses and synthesizes existing literature, scholarly articles, and previously published empirical studies to examine how personality dimensions influence financial decision-making. The study critically reviews established findings to identify consistent patterns between OCEAN personality traits and levels of financial risk tolerance. The research also includes perspectives from behavioural finance to explain how psychological tendencies shape investment attitudes, portfolio selection, and reactions to uncertainty in financial markets. Particular attention is given to how traits such as openness and extraversion may encourage higher risk acceptance, whereas conscientiousness and neuroticism may be associated with more cautious and structured investment strategies. By integrating theoretical frameworks with past research evidence, the study aims to provide a clearer understanding of investor psychology. The findings contribute to the growing body of secondary research linking personality and financial behaviour, while also offering insights that may support personalized financial planning, improved risk assessment, and future academic exploration in behavioural finance.

Introduction

Financial decision-making plays a crucial role in an individual’s financial stability, wealth creation, and security. Traditional finance viewed decisions as rational and objective, but behavioral finance highlights that psychological, emotional, and cognitive factors also influence financial choices. Among these, personality traits significantly affect financial risk-taking behavior, which involves making uncertain financial decisions with the possibility of losses. Individuals with similar knowledge and income levels may still display different levels of risk tolerance, influencing their investment strategies, portfolio diversification, and long-term financial well-being.

The Big Five personality traits—Openness, Conscientiousness, Extraversion, Agreeableness, and Neuroticism—provide a framework for understanding differences in financial behavior. Research shows that traits such as openness and extraversion are generally associated with higher financial risk tolerance, while neuroticism is linked to risk aversion. These personality characteristics shape how individuals perceive uncertainty, process financial information, and make investment decisions.

In India, personality-based financial research has gained importance, with studies showing that personality traits strongly influence investment decisions, behavioral biases, and financial literacy. Previous research in behavioral finance demonstrates that investors are not always rational and are often influenced by emotions, biases, demographics, and personality. Studies also highlight that personality traits can help predict investment intentions, trading behavior, and portfolio choices.

The present study uses a secondary research approach to review existing literature on the relationship between Big Five personality traits and financial risk-taking behavior. It combines perspectives from personality psychology and behavioral finance to explain how stable personality characteristics influence financial decision-making. The study particularly emphasizes openness to experience, which is associated with curiosity, creativity, and greater willingness to take financial risks, though excessive openness may also increase the possibility of investment losses.

Conclusion

The study aimed to understand the relation between The Big 5 Personality traits and the financial risk taking behaviour by reviewing the existing research. The research clearly show that personality influences an individual\'s financial decision and how much risk they take with money. The research suggests that individuals high in openness and extraversion are more willing to take high risk financial decisions because they feel confident, comfortable and are more open to new information. On other hand, individuals high in neuroticism tend to avoid risk because they feel more anxious and are worried of potential losses. Agreeableness, here individuals make safer financial decisions, as they prefer stability and security. Conscientiousness helps individuals to make careful and planned decisions, leading to more balanced and calculated investment choices. Overall the findings show that financial risk taking behaviour is not only influenced by income, knowledge or market conditions but also by personality traits of individuals. This helps to understand why different people with similar knowledge make different financial decisions. The study highlights the importance of considering personality while giving investment advice. When financial advice matches an individual\'s personality, individuals are more likely to make decisions according to it. To conclude, the Big 5 Personality traits provide useful and practical ways to understand differences in financial risk taking behaviour. Understanding the role of personality can help to make better predictions of financial behaviour of individuals and help to make a more personalized approach to financial planning.

References

[1] Brooks, C,.Williams, L.(2020) The Impact of Personality Traits on Attitude to Financial Risk. https://ssrn.com/abstract=3729114 [2] Liu, Chung & Woo, Kai & Hon, Tai. (2016). The relationship between personality traits and investment risk preference. https://www.researchgate.net/publication/301713794_The_relationship_between_personality_traits_and_investment_risk_preference [3] Mei-Hua, Chen & Chien-Mei, Hsiao. (2024). Risk Attitudes and Personality Traits Among Investors in Funds. https://www.researchgate.net/publication/301713794_The_relationship_between_personality_traits_and_investment_risk_preference [4] Sarwar, Danish & Sarwar, Bilal & Raz, Asif & Khan, Hadi & Muhammad, Noor & Azhar, Usman & Zaman, Nadeem Uz & Kasi, Mumraiz. (2020). Relationship of the Big Five Personality Traits and Risk Aversion with Investment Intention of Individual Investors. https://www.researchgate.net/publication/346554778_Relationship_of_the_Big_Five_Personality_Traits_and_Risk_Aversion_with_Investment_Intention_of_Individual_Investors [5] Khaitan, Jyotsna & Singh, Divya. (2025). Big Five Personality Traits and Financial Risk Tolerance among ?Retail Investors: A Systematic Literature Review. https://www.researchgate.net/publication/396259071_Big_Five_Personality_Traits_and_Financial_Risk_Tolerance_among_Retail_Investors_A_Systematic_Literature_Review [6] Rushdi, N. J. (2014). Impact of psychological influence on investment behaviour of salaried investors in India. https://shodhganga.inflibnet.ac.in/handle/10603/44202 [7] Shah, D. (2024). A study on the influence of Big Five personality traits on investment decision behaviour of investors https://shodhganga.inflibnet.ac.in/handle/10603/575611 [8] Thomas, T. C. (2014). Big five personality traits and behavioural aspects of individual investors in Indian capital market https://shodhganga.inflibnet.ac.in/handle/10603/49586 [9] Sachan, A. (2017): A Study of relationships between personality traits and demographic characteristics with behavioural biases of individual investors https://shodhganga.inflibnet.ac.in/handle/10603/195968 [10] Mehraj, A. (2024): Exploring the Impact of Big Five Personality Traits on Behavioral Bias of Individual Investors, A study of North India https://shodhganga.inflibnet.ac.in/handle/10603/605768 [1] Brooks, C,.Williams, L.(2020) The Impact of Personality Traits on Attitude to Financial Risk. https://ssrn.com/abstract=3729114 [2] Liu, Chung & Woo, Kai & Hon, Tai. (2016). The relationship between personality traits and investment risk preference. https://www.researchgate.net/publication/301713794_The_relationship_between_personality_traits_and_investment_risk_preference [3] Mei-Hua, Chen & Chien-Mei, Hsiao. (2024). Risk Attitudes and Personality Traits Among Investors in Funds. https://www.researchgate.net/publication/301713794_The_relationship_between_personality_traits_and_investment_risk_preference [4] Sarwar, Danish & Sarwar, Bilal & Raz, Asif & Khan, Hadi & Muhammad, Noor & Azhar, Usman & Zaman, Nadeem Uz & Kasi, Mumraiz. (2020). Relationship of the Big Five Personality Traits and Risk Aversion with Investment Intention of Individual Investors. https://www.researchgate.net/publication/346554778_Relationship_of_the_Big_Five_Personality_Traits_and_Risk_Aversion_with_Investment_Intention_of_Individual_Investors [5] Khaitan, Jyotsna & Singh, Divya. (2025). Big Five Personality Traits and Financial Risk Tolerance among ?Retail Investors: A Systematic Literature Review. https://www.researchgate.net/publication/396259071_Big_Five_Personality_Traits_and_Financial_Risk_Tolerance_among_Retail_Investors_A_Systematic_Literature_Review [6] Rushdi, N. J. (2014). Impact of psychological influence on investment behaviour of salaried investors in India. https://shodhganga.inflibnet.ac.in/handle/10603/44202 [7] Shah, D. (2024). A study on the influence of Big Five personality traits on investment decision behaviour of investors https://shodhganga.inflibnet.ac.in/handle/10603/575611 [8] Thomas, T. C. (2014). Big five personality traits and behavioural aspects of individual investors in Indian capital market https://shodhganga.inflibnet.ac.in/handle/10603/49586 [9] Sachan, A. (2017): A Study of relationships between personality traits and demographic characteristics with behavioural biases of individual investors https://shodhganga.inflibnet.ac.in/handle/10603/195968 [10] Mehraj, A. (2024): Exploring the Impact of Big Five Personality Traits on Behavioral Bias of Individual Investors, A study of North India https://shodhganga.inflibnet.ac.in/handle/10603/605768

Copyright

Copyright © 2026 Jiiyaa Deolekar . This is an open access article distributed under the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.