Journal Press India^®

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Investment decisions of the investors are influenced by different objective and subjective factors. But we as investors ignore or not knowingly our emotions, feelings and sentiments make investment decisions. This disturbs our investment objective and the returns on investments gets effected. Hence, an attempt is made to understand the effect of prospect rules on investors’ investment decisions. The research methodology is descriptive and causal in nature. The sample for the study are the retail investors from Belagavi city. The data to study the effect will be collected through primary source by the questionnaire. The result of regression analysis showed that there was impact of loss aversion and disposition effect on investor’s investment decision. Even the way information is framed the investors get carried away by that, while making the decision of money to be invested. It was also found that less than 10% of the savings are getting invested by the investors. The results would be of use to the financial advisors and investors in knowing the subjective factors affecting their client’s money related decisions.

Keywords

Investment Decisions; Heuristics; Prospect Rules; Behavioral Finance; Behavioral Biases

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