Applicability of Self-Selection Sampling in Behavioural Finance Studies

The use of sampling methods has a significant impact on the validity and reliability of research. Though methods like random sampling are known for being statistically representative of the population at hand, they tend to require a comprehensive sampling frame, which cannot be obtained in most cases in psychological studies involving investors' decisions and behaviour. Methods like non-probability sampling have generally been criticized for having the problem of bias, but sometimes this kind of sampling may be better suited because it can provide authentic results from the people willing to give sincere responses. This paper aims to study the suitability of self-selection sampling in behavioural finance especially when study about overconfidence bias, disposition effect etc. In this respect, this study focuses on the possible advantages of using self-selection sampling in situations where the respondents are expected to be sincere with their answers and thus represent the true states of mind. By discussing methodological choices and considerations, this paper attempts to show how self-selection sampling can be used intentionally in lieu of random sampling when it is impractical to do so