SUMMARY
Purpose:This study motivated by the limited study on Islamic Capital Market, mainly in Behavioral Finance field. Moreover, the incongruity findings in prior research investigations suggests additional investigation to elucidate the correlation between literacy and investing intention. This study aims to clarify financial literacy roles on investment intention, as mediated by risk perception. Specifically, the effect of Islamic Capital Market Literacy on Intention to Invest in Islamic Capital Market.Design/Methodology/Approach:The present study employs a quantitative methodology to address the issue under investigation. The study's sample comprised 200 respondents from the generation Z investor population residing in Malang City. The research instrument employed a set of seven Likert scales. The present study employed Partial Least Squares Structural Equation Modelling (PLS-SEM) for data analysis.Findings: The research findings show that Islamic capital market literacy affects risk perception and investment intention, and risk perception has a direct effect on investment intention. In addition, risk perception also successfully mediates the effect of capital market literacy on Gen Z's investment intention in the Islamic capital market.Originality/Value:This research has valuable contribution to the existing body of Islamic capital market literature, which has received limited attention. The research highlights the significance of Islamic capital literacy and establishing a favourable perspective of risk as a practical aspect. The results has valuable input for government in developing policies that promote increased involvement of young individuals in investing activities by enhancing literacy levels.One problem identified in this study is the lack of differentiation between respondents based on their level of literacy and the duration of their engagement. This aspect holds significant importance in influencing an individual's perception of risk.Keywords: Generation Z; Islamic Capital Market Literacy; Investment Intention; Risk PerceptionPaper type: Research paper