A Study Analyzing Investor Psychology and Market Confidence in Promoting the Corporate Bond Market in Vietnam

This study investigates the psychological factors influencing investor behavior and market confidence in Vietnam's corporate bond market. It identifies key biases, including overconfidence, herd behavior, loss aversion, anchoring, regret aversion, and the availability heuristic, which significantly impact investment decisions and contribute to market inefficiencies. The research underscores the critical role of market confidence in promoting market growth and stability, emphasizing the importance of regulatory transparency and investor trust. The study also highlights the unique challenges faced by emerging markets like Vietnam, where lower liquidity and higher volatility amplify the effects of investor psychology. Recommendations for enhancing investor confidence include strengthening regulatory frameworks, improving market transparency, developing a reliable credit rating system, and promoting investor education. The findings contribute to the broader literature on behavioral finance by applying established theories to the context of an emerging market, offering insights into how psychological factors can be managed to support the sustainable development of corporate bond markets.