The Study on Investment Profiling of Retail Investors: An Empirical Examination

Abstract

India is a growing economy and with this the investment needs of the people eventually grow which brings the opportunities for our capital markets to develop such products which support the financial needs of the customers. The Indian investors incorporate saving habits but being conventional in their approach they are still reluctant to make investments in modern investment options. The risk and return are the important component for an investment options and among the various investment avenues available, the investor tries to identify this important relationship. To study the same, using descriptive statistics and ANOVA we have done the investment profiling of investors for three classes i.e. business, salaried and professional class investors which explains style of individual preferences in investment decisions and their investment pattern. The results highlight that certain factors like education level, awareness about the current financial system, age of investor etc. make significant impact while deciding the investment avenue. Awareness was the biggest barrier for making investment in unconventional financial instruments.

Keywords: ANOVA, Financial market, Investment pattern, Investor behavior, Investment avenues.