Journal Press India®

Impact of behavioural factors on Investment Decision of Individual: An analytical study

Vol 7 , Issue 2 , July - December 2018 | Pages: 51-60 | Research Paper  

https://doi.org/10.51976/gla.prastuti.v7i2.721807


Author Details ( * ) denotes Corresponding author

1. * Som Nath Paul, Assistant Professor, School of Business Management, IFTM University, Moradabad, Uttar Pradesh, India (paulsom1308@gmail.com)
2. Rakesh Kumar Yadav, Professor, School of Business Management, IFTM University, Moradabad, Uttar Pradesh, India (rkymoradabad@rediffmail.com)

This study tries to express and comprehend those factors which have their impact on person's investment decision process. The researchers have tried to establish a relationship about the people’s reaction towards their social finance decisions. It is an attempt to interlink the factors and their impact on investment decision of small investors. Researchers made here an experimental investigation to see how an individual conveys an investment decision and how extraordinary factors influence his investment decision movement. Motive to invest is very much essential or we can say is a crucial factor which influences an individual for choosing his investment. In general, investment decisions are moulded by various behavioural aspects reflected by people like predispositions, observation, sex, age, feelings and their identity attributes. These factors are correlated together like strings of guitar that pulling one will affect them all, which transform in to music. One can observe that correct tensions in the strings will provide great music, where wrong provide something else. The similar relationship, we find in our investment decision also, if we are of different gender, age or predispositions we will react towards investment differently.

Keywords

Behavioural Bias, Personality Trait, Investment, Demography, factor analysis.

  1. Allen W David and Evans Dorla A (2005), “Bidding and Overconfidence in Experimental Financial Markets”, The Journal of Behavioural Finance, Vol. 6, No. 3, pp. 108-120.
  2. Arano K, Parker C and Terry R (2010), “Gender-Based Risk Aversion and Retirement Asset Allocation”, Economic Inquiry, Vol. 48, No. 1, pp. 147-155.
  3. Alexander G J, Jones J D and Nigro P J (1997), “Investor Self Selection: Evidence from Mutual Fund Industry”, Managerial and Decision Economics, Vol. 18, Nos. 7 & 8, p. 719.
  4. Bajtelsmit V L and Bernasek A (1996), “Why Do Women Invest Differently Than Men?”, Financial Counseling and Planning, Vol. 7, pp. 1-10.
  5. Byrnes J P, Miller D C and Schafer W D (1999), “Gender Differences in Risk Taking: A Meta- Analysis”, Psychological Bulletin, Vol. 125, No. 3, pp. 367-383.
  6. Bodi, Kane and Marcus, “Investment” 10th edition, 2014 by McGraw-Hill, USA.
  7. Embrey L L and Fox J J (1997), “Gender Differences in the Investment Decision- Making Process”, Financial Counseling and Planning, Vol. 8, No. 2, pp. 33-40.
  8. Fama E F (1965), “The Behaviour of Stock Market Prices”, The Journal of Business, Vol. 38, No. 1, pp. 34- 105.
  9. Fama E F (1970), “Efficient Capital Markets: A Review of Theory and Empirical Work”, Journal of Finance, Vol. 25, No. 2, pp. 383-417.
  10. Fama E F, Fisher L, Jensen M and Roll R (1969), “The Adjustment of Stock Prices to New Information”, International Economic Review, Vol. 10, No. 1, pp. 1- 21.
  11. Hibbert A M, Lawrence E and Prakash A (2008), “Are Women More Risk-Averse Than Men?”, Downloaded from http://new.cffit.de/fileadmin/docs/docs_cfp/ paper_2009 /hibbert lawrence _ and_prakash_-_are _women_more_risk-averse_than_men.pdf.
  12. Kumar Alok (2009), “Hard-to-Value Stocks, Behavioural Biases, and Informed Trading”, Journal of Financial and Quantitative Analysis, Vol. 44, No. 6, pp. 1375-1401.
  13. Lord Charles G, Ross Lee and Lepper Mark R (1979), “Biases Assimilation and Attitude Polarization: The Effects of Prior Theories on Subsequently Considered Evidence”, Journal of Personality and Social Psychology, Vol. 37, No. 11, pp. 2098-2109
  14. Mittal M and Vyas R K (2007), “Demographics and Investment Choice Among Indian Investors”, The IUP Journal of Behavioural Finance, Vol. 4, No. 4, pp. 51- 65.
  15. Peng Lin (2005), “Learning with Information Capacity Constraints”, Journal of Financial and Quantitative Analysis, Vol. 40, No. 2, pp. 307-329.
  16. Peng Lin and Xiong Wei (2006), “Investor Attention, Overconfidence and Category Learning”, Journal of Financial Economics, Vol. 80, No. 3, pp. 563-602.
  17. Powell M and Ansic D (1997), “Gender Differences in Risk Behaviour in Financial Decision-Making: An Experimental Analysis”, Journal of Economic Psychology, Vol. 18, No. 6, pp. 605-628.
  18. Prince M (1993), “Women, Men and Money Styles”, Journal of Economic Psychology, Vol. 14, No. 1, pp. 175-182.
  19. Powell M and Ansic David (1997), “Gender Differences in Risk Behavior in Financial Decision Making: An Experimental Analysis”, Journal of Economic Psychology, Vol. 18, No. 6, pp. 605-628.
  20. Ranganathan K (2006), “A Study of Fund Selection Behavior of Individual Investors Towards Mutual Funds: With Reference to Mumbai City”, The IUP Journal of Behavioural Finance, Vol. 3, No. 2, pp. 63- 83.
  21. Samuelson William and Zeckhauser Richard (1988), “Status Quo Bias in Decision Making”, Journal of Risk and Uncertainty, Vol. 1, No. 1, pp. 7-59.
  22. Siebenmorgen N and Weber M (2004), “The Influence of Different Investment Horizons on Risk Behavior”, Journal of Behavioural Finance, Vol. 5, No. 2, pp. 75-90.
  23. Singh J and Chander S (2006), “Investors’ Preference for Investment in Mutual Funds: An Empirical Evidence”, The IUP Journal of Behavioural Finance, Vol. 3, No. 1, pp. 55-70. 
  24. Sunden A E and Surette B J (1998), “Gender Differences in the Allocation of Assets in Retirement Savings Plans”, American Economic Review, Vol. 88, No. 2, pp. 207-211.
  25. Swinyard W R (1993), “The Effect of Mood, Involvement, and Quality of Store Experience in Shopping Intentions”, Journal of Consumer Research, Vol. 20, No. 2, pp. 271-280.
  26. Tversky A and Kahneman D (1974), “Judgment Under Uncertainty: Heuristics and Biases”, Science, Vol. 185, No. 4157, pp. 1124-1131.
  27. Urbany J E, Peter R D and Wilkie W L (1989), “Buyer Uncertainty and Information Search”, Journal of Consumer Research, Vol. 16, No. 2, pp. 208-215.
  28. Wright P (1974), “The Harassed Decision Maker: Time Pressures, Distractions and the Use of Evidence”, Journal of Applied Psychology, Vol. 59, No. 2, pp. 556-561.
Abstract Views: 7
PDF Views: 442

Advanced Search

News/Events

Indira Institute of ...

Indira Institute of Management, Pune Organizing International Confe...

D. Y. Patil Internat...

D. Y. Patil International University, Akurdi-Pune Organizing Nation...

ISBM College of Engi...

ISBM College of Engineering, Pune Organizing International Conferen...

Periyar Maniammai In...

Department of Commerce Periyar Maniammai Institute of Science &...

Institute of Managem...

Vivekanand Education Society's Institute of Management Studies ...

Institute of Managem...

Deccan Education Society Institute of Management Development and Re...

S.B. Patil Institute...

Pimpri Chinchwad Education Trust's S.B. Patil Institute of Mana...

D. Y. Patil IMCAM, A...

D. Y. Patil Institute of Master of Computer Applications & Managem...

Vignana Jyothi Insti...

Vignana Jyothi Institute of Management International Conference on ...

Department of Commer...

Department of Commerce, Faculty of Commerce & Business, University...

By continuing to use this website, you consent to the use of cookies in accordance with our Cookie Policy.