Investors' Behavior and Preference: A Case Study of Indian Stock Market

Abstract

Finance has been studied around the globe from ages but the dimensions of behavioral science have been related with finance only a few decades before. This led to evolution of behavioral finance, where effect of human emotions, cognitive errors and psychology on investment decision is studied. The main objective of this study was to explore the individual investors' investment preference i.e., utilitarian or value-expressive. Moreover, the extent to which their investment decision is dominated by their investment preference has been studied. The relationship between demographic factors and investment preference of an individual has also been examined. The results show that the individual investors at Indian stock exchange, in general, are more value-expressive than utilitarian. Their investment decisions are affected by many behavioral biases as well as with certain demographic factors.