An Empirical Analysis of Factors Influencing Indian Individual Equity Investors’ Decision Making and Behavior

Abstract

The decision making process is a cognitive process which results in the selection of a course of action among several alternatives. Every decision-making process produces a final choice. The output can be an action or an opinion of choice. Investment decisions made today often are critical for financial security in later life, due to the potential for large financial loss and the high costs of revising or recovering from a wrongful investment decision. Most of the equity investors do not have the sufficient knowledge of basic economic concepts required to make investment decisions. To identify these factors the current study has applied factor analysis. After applying factor analysis it was found that all the 40 attributes are reduced to the following ten factors Individual Eccentric, Wealth Maximization, Risk Minimization, Brand Perception, Social Responsibility, Financial Expectation, Accounting information, Government & Media, Economic Expectation and Advocate recommendation factors.

Keywords: Indian Individual Equity Investor, Decision making, Factors Influencing.