Social media significantly influences investor behavior, particularly in emerging markets like the Egyptian stock market. This study examines its impact on trading frequency, herding behavior, and overconfidence among Egyptian investors. Data were collected through a structured survey of 300 active investors, distributed via two prominent Facebook pages: “The Popular Union of Investors in the Egyptian Stock Market” and “Investment in the Egyptian Stock Market.” The sample was determined using Cochran’s formula, achieving a 78% response rate from the 385 recommended respondents. A descriptive quantitative approach was employed, utilizing correlation tests and regression analysis to assess relationships between social media engagement and investor behavior. Findings indicate that social media usage significantly increases trading frequency, as investors make more reactive decisions based on rapidly available information. Herding behavior is also positively associated with social media engagement, demonstrating that investors tend to follow market trends and decisions discussed in online communities. Additionally, social media exposure fosters overconfidence, leading to increased risk-taking behavior. The study emphasizes the critical role of social media in shaping investor behavior, recommending investor education on cognitive biases linked to social media. Financial advisors should also address its influence on client decision-making. Future research should explore platform-specific features, such as visual content and influencer-driven financial advice.
