The Influence of Digital Financial Innovations (FinTech) on Investor Behavior and Financial Market Efficiency

Digital financial technologies (FinTech) have emerged as a major catalyst in reshaping investor behavior and altering the efficiency of financial markets. The present research investigates how the expansion of FinTech affects investor behavior and the volatility of returns in the Iranian capital market during the years ۲۰۱۶–۲۰۲۵. To assess short- and medium-term dynamics, conditional volatility models—specifically GARCH and EGARCH—were utilized. The dataset incorporates variables such as online trading activity, the number of users of digital trading platforms, growth in mobile-based transactions, indicators of firm performance, and key macroeconomic measures. All analyses were performed using EViews ۱۳ software.The findings reveal that greater FinTech penetration significantly intensifies market volatility, amplifying speculative behavior and increasing short-term trading tendencies among retail investors. In contrast, variables such as firm size, market liquidity, and economic growth exert stabilizing effects by dampening return fluctuations. The results also indicate that inflation and policy interest rates heighten market volatility, while negative return shocks lead to stronger and more asymmetric responses. Overall, the study concludes that FinTech brings both substantial benefits and noteworthy risks to financial markets, emphasizing the necessity of effective risk-management mechanisms, enhanced financial literacy for investors, and the development of well-structured regulatory and economic policies to support market stability and efficiency.

کلیدواژه ها:

digital financial innovation ، FinTech ، investor behavior ، return volatility ، market efficiency ، GARCH/EGARCH