Mohammad Enamul Hoque, Low Soo-Wah, Mohammad Mujibul Haque
Financial literacy and financial information sources are crucial in influencing investors’ risky investment behavior, which is reflected in their investment decisions and performance. However, these relationships have not been fully explored, particularly in the context of Bangladesh. Understanding how different types of financial literacy interact with financial information sources can assist investors in making informed investment decisions and achieving better performance. This study offers a unique perspective by differentiating two types of financial literacy—basic financial literacy and financial market literacy—in investigating the link between risky investment behavior and five types of financial information sources—advisors, brokers, friends & family, financial reports, and media coverage. Data were collected through a self-administered structured questionnaire from 474 retail investors in Bangladesh, and hypotheses were tested via multivariate regression models. All financial information sources are highly significant, suggesting that information sourced from advisors, brokers, friends & family, financial reports, and media coverage importantly influences investors’ investment decisions and performance. Specifically, basic financial literacy strengthens the informational effects of advisors and brokers on investors’ investment decisions, whereas financial market literacy weakens the impact of information sourced from friends and family. With respect to investment performance, basic financial literacy improves the informational effects of advisors, whereas advanced financial literacy strengthens the informational impacts of brokers. Additionally, the moderation effects of financial literacy are contingent on investors’ financial interest and risk tolerance levels, suggesting the importance of recognizing investors’ unique traits. These findings expand academic understanding, support policy interventions in designing targeted financial literacy programs, and provide insights for investors in formulating investment strategies that align with their financial interest and risk tolerance levels. © The Author(s) 2026.
BRAC Business School, BRAC University, Dhaka, Bangladesh; Faculty of Economics and Business, Universitas Negeri Padang, Padang, Indonesia; Graduate School of Business, Universiti Kebangsaan Malaysia, Selangor, Malaysia
