Risk Tolerance Dependent on What? Demographics or Personality Type: Findings from an Empirical Research

Abstract

An investor’s decision regarding investment is influenced by a number of factors. Many researchers have concluded that risk tolerance level of investors plays a vital role in making investment decision. It is therefore importance to measure the risk tolerance level of investors. Many studies have concluded that risk taking capabilities of an individual is based on his basic demographic characteristics such as age, gender, marital status, income level, education, family background and   occupation etc. yet  no  major systematic  effort has been made  to ascertain  the impact of personality trait of an individual on his risk taking  behavior.In the proposed study an attempt has been made to ascertain the relationship of (a) demographic variables (b) personality trait on risk taking behavior of investors.