Structural Equation Modelling of Behavioural Factors Influencing Intraday Trading Prospects in Nepal

Intraday trading—buying and selling the same equities within a single trading day—is still absent in Nepal. This study investigates investors’ willingness to engage in intraday trading and pinpoints the behavioural factors that shape their stock-trading decisions. Guided by behavioural finance, an exploratory design was applied. Using non-probability sampling, 226 investors in Kathmandu Valley completed structured questionnaires via KOBO Toolbox. Using SPSS–AMOS software, descriptive statistics and structural equation modeling tested the proposed relationships. Herding behaviour emerged as the dominant driver of trading decisions, amplified by information from informal channels such as social media. Traditional heuristics, prospect biases and general market conditions showed little influence on the intention to trade intraday. Regulators and market operators should prioritise trading literacy initiatives and reduce information asymmetry to foster a viable intraday market. Future studies should extend the sample beyond Kathmandu Valley to validate and refine these insights. This study sheds light on the underexplored domain of intraday trading in Nepal and offers unique insights into the behavioural aspects driving traders’ decisions, contributing to the literature on stock market dynamics in emerging economies.