A fuzzy-hybrid analytic model to assess investors' perceptions for industry selection

Hasan Dincer, Umit Hacioglu, Ekrem Tatoglu, Dursun Delen

Research output: Contribution to journalArticlepeer-review

51 Scopus citations


The 2008-2009 global financial crisis and its subsequent ramifications on capital markets have led to an increasing attention on the importance of cognitive and behavioral issues in finance. The purpose of this study is to determine the ranking of the industry alternatives for portfolio investments based on individual investors' perceptions. Accordingly, a hybrid analytic multi-criteria decision model (MCDM) - based on the Fuzzy Analytic Hierarchy Process (FAHP) and the Fuzzy Technique for the Order of Preference by Similarity to Ideal Solution (FTOPSIS) methods along with sensitivity analysis - is developed to identify and rank-order the best performing industry options. The proposed model is applied to Borsa Istanbul Stock Exchange 100 Index (BIST 100) in Turkey. The results indicate that (i) the investors' perceptions on market conditions and global financial situation influence their industry selection on company stocks; (ii) the investors' perceptions on portfolio investments rely heavily on performance and risk levels of individual asset/stocks, and (iii) traded stocks of financial industry (along with its sub-industries) have greater performance expectations than those of the ones in other industries such as technology, services and tourism.

Original languageEnglish
Pages (from-to)24-34
Number of pages11
JournalDecision Support Systems
StatePublished - 1 Jun 2016
Externally publishedYes


  • Emerging economies
  • Fuzzy AHP
  • Fuzzy TOPSIS
  • Hybrid analytic modeling
  • Investment decisions
  • Investor perception


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