EXECUTIVE SUMMARY

The adoption of online trading systems (OTS) has transformed financial markets globally, including in Nepal. However, investors encounter various risks that affect their engagement with these platforms. This study examines the impact of perceived risks; financial, privacy, performance, psychological, and time-related on investors’ usage behavior of Nepal’s Trading Management System (TMS). Additionally, it examines the relationship between usage behavior and investor satisfaction, providing insights for improving digital trading experiences.

The study employs quantitative research methodology where data was collected through structured questionnaires, combining online and offline methods, from 387 TMS users. Structural Equation Modeling (SEM) was used to analyze the relationships between perceived risks, investor behavior, and satisfaction.

The results indicate that financial and privacy risks do not significantly impact TMS usage, suggesting strong regulatory oversight and platform security reduce these concerns. Time risk was found to have an insignificant but positive effect, implying that although delays exist, they do not discourage users. On the other hand, psychological risk has a negative impact on investor behavior, as stress and anxiety discourage users from engaging with the platform. Although performance risk is significant, it positively affects usage behavior, suggesting that investors continue using TMS despite technical issues, likely due to the absence of alternative platforms. Furthermore, the study confirms a strong positive relationship between TMS usage and investor satisfaction.

This study highlights the importance of improving security, minimizing system errors, and enhancing user experience in Nepal’s online trading platforms. Regulatory bodies could strengthen cybersecurity measures and investor protection to build trust. Educational programs can also help investors understand psychological risks and gain confidence in digital trading. As one of the first studies to analyze perceived risks using SEM, this research provides valuable insights for platform developers, regulators, and researchers to improve investor engagement and satisfaction.