Financial Literacy, Financial Well-being and Stock Market Participation: Evidence from Oman

The population's participation in the stock market depends not only on the availability of investment instruments but also on financial knowledge and assessments of one’s own financial situation. This study examines financial literacy and stock market participation in Oman, considering demographic differences and the role of financial well-being in their relationship. The study uses methods of descriptive statistics, hierarchical binary logistic regression, and the Karlson–Holm–Breen (KHB) decomposition method. The empirical basis consisted of the results of an online survey conducted from February to June 2026 in Muscat, Salalah, and Sohar. Of the 1,000 questionnaires distributed, 786 responses were received; after verification, 739 respondents were included in the final sample. The results showed relatively low objective financial literacy: 47% of respondents answered questions about interest rates correctly, 41% about inflation, and 36% about financial risks. At the same time, 62% of participants reported a high level of financial well‑being, while only 26% reported participating in the stock market. Regression analysis revealed a positive relationship between financial literacy and participation in the stock market (odds ratio — 1.42 in the second model and 1.33 in the third), while for financial well‑being, this indicator was 1.25. Additional analysis indicates its possible mediating role in the relationship under consideration. The obtained results indicate the need to develop practical financial skills among the population of Oman, along with increasing the availability of investment services.

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