EFFECTS OF FINANCIAL LITERACY ON INVESTMENT DECISION IN THE CASE OF COMMERCIAL BANK OF ETHIOPIA CUSTOMER OPERATING IN GURAGE ZONE

Abstract

The objective of the study is to establish the effect of financial literacy on investment decision making .A target population of 16 commercial banks that found in gurage zone used. The study used primary sources of data. Data is collected through the use of semi- structured questionnaires. Secondary data obtained from internet, journals and newspapers. The responses to every question of the investment decisions dimensions are tabulate by use of analysis of variance and multiple recreations. The present study employed a few determinants to assess financial literacy as knowledge about financial products, Accessing financial products, money management, knowledge about financial investment option, and financial skills. The study focuses to examine, how a financial literacy influences his/her financial opinions, decisions and practices. Regression analysis was carried out to show the nature of the relationship between independent and dependent variables. Results of the study revealed that there was a positive and significant relationship between financial knowledge, financial attitude and investment decision while both financial behavior and financial awareness had positive and significant relationship with investment behavior CBE should continuously sensitize members on how to improve their financial management skills and attitude as such to foster their investment decision. Although, financial behavior and awareness had positive and significant relationship there is need of sensitization sessions to improve financial behavior and adopt customized financial awareness essions.