Financial behaviour of muslim investment consumers in Malaysia : a religion measurement invariance analysis

Abstract

This study examines a religion measurement invariance of a first-order factor model of financial behavior among Muslim Investors in Malaysia. Data elicited via a survey questionnaire was analyzed using both the Statistical Package for Social Sciences (SPSS) 22.0 and Amos 22.0 software. The study revealed that financial behaviour as a first order factor is indicated by regret aversion, mental accounting, cognitive dissonance, anchoring, herding, and overconfidence first. Measurement invariance was tested based on self-reported level of religion adherence via a set of hierarchically structured levels: a) configural invariance, b) metric invariance of the first-order model, c) intercepts of the first-order model, and d) residuals of the first-order model. Moreover, based on t-test at alpha of0.001, the latent mean difference tests of the first order model indicators was also assessed for statistically significant difference on a path by path basis along religion demographic divides.