A Study on the Individual Investor Behavior with Special Referance to Geojit BNP Paribas Financial Service Ltd, Coimbatore. Gnani Dharmaja .V, Mechanical Engineering Psg College of Technology, Coimbatore, India Ganesh .J, Electrical and Electronics Engineering, PSG College of Technology, Coimbatore, India Dr. Santhi .V Department Of Humanities Psg College of Technology Coimbatore, India ABSTRACT
Research in behavioral finance is relatively new. Within behavioral finance it is assumed that information structure and the characteristics of market participants systematically influence individuals’ investment decisions as well as market outcomes. According to behavioral finance, investor market behavior derives from psychological principles of decision making to explain why people buy or sell stocks. The research we have done was on the topic “Factors Influencing the Individual Investor Behavior”. The study aims at identifying the most and the least influencing factors of the individual investor behavior. The project is based on descriptive research design. The data was collected with the help of a questionnaire. The questionnaire included thirty items that belong to five categories: selfimage/firm-image co-incidence, accounting information, neutral information, advocate recommendations and personal financial needs. The sample size considered for the study was 200 wherein all the samples were investors of GEOJIT BNP PARIBAS FINANCIAL SERVICE LTD, COIMBATORE. The tools used for the analysis include Chi-Square Test. The analysis was divided into 2 phases which are Personal Factors and Behavioral Factors. The study revealed that accounting information is the most influencing group of the individual investor behavior and neutral information is the least influencing group of the individual investor behavior. It was found that there are also some behavioral factors like the investor’s financial tolerance, emotional risk tolerance and financial literacy which influence the investor’s behavior. Based on the analysis Suggestions for improvement are provided.
Most financial theory is based on the idea that everyone takes careful account of all available information before making investment decisions. But there is much evidence that is not the case. Behavioral finance, a study of the markets that draws on psychology, is throwing more light on why people buy or sell the stocks they do - and even why they do not buy stocks at all. This research on investor behavior helps to explain the various 'market anomalies' that challenge standard theory. It is emerging from the academic world and beginning to be used in money management.
OBJECTIVES OF THE STUDY Primary Objective
To study the various factors influencing the investment behavior of individual investors.
To study the impact of the self-image/firm image coincidence on the investor behavior. To identify the influence of the accounting information on the investor behavior. To find out the effect of the factors related to neutral information on the investor behavior. To analyze the impact of the advocate recommendation on the investor behavior. To interpret the effect of the factors related to personal financial needs on the investor behavior. To study the investment pattern of the investors based on their risk taking abilities. To study the investment time horizon of the investors based on their personal profile.
INTRODUCTION Factors influencing investor behavior:
SCOPE OF THE STUDY
Research in behavioral finance has important applications. A better understanding of behavioral processes and outcomes is important for financial planners because an understanding of how investors generally respond to
IRACST- International Journal of Research in Management & Technology (IJRMT), ISSN: 2249-9563 Vol. 2 No.2, April 2012 market...