IDEAS home Printed from https://ideas.repec.org/a/aii/ijcmss/v07y2016i1p97-102.html
   My bibliography  Save this article

Behavioural Finance: An Introspection of Investors Psychology

Author

Listed:
  • G. K. Deshmukh

    (Assistant Professor, Institute of Management, Pt. Ravishankar Shukla University, Raipur (CG), India.)

  • Sanskrity Joseph

    (Assistant Professor, Institute of Management, Pt. Ravishankar Shukla University, Raipur (CG), India.)

Abstract

Purpose: Investors always try to make rational decision while analyzing and interpreting information collected from various sources for different investment avenues to arrive at an optimal investment decision. But at the same time they are influenced by various psychological factors that influence them internally and bias their investment decision. Linter (1998) studied the various factors that influence internally the informed investment decision and included them under the discipline of behavioural finance. Behavioural finance studies how people make investment decision and influenced by internal factors and bias. The main purpose of the paper is to assess impact of behavioural factors over mutual fund investment decision made by investors in Raipur city. Design/methodology/approach: The researchers conducted a survey on factors of behaviour of investors with respect to investment in mutual fund industry from 300 investors of mutual funds across different demographic profiles in Raipur city. Major Result / Findings: The researchers assessed that factors like perception, motivation, incentive potential, intensity of cues play major role in formation of intention to invest which further influence investors in Raipur city to take investment decision that determines their satisfaction with mutual fund which is based on performance and growth of a particular mutual fund. Implications: This paper helps in analyzing the factors which influence formation of intention to invest and further direct towards investment in a particular mutual fund. Various mutual fund companies can concentrate on these factors to devise strategies to pull investors to invest in their mutual fund. Originality/value: This a fairly original paper which has tested the model developed by researchers using SEM. Paper type: Empirical and descriptive

Suggested Citation

  • G. K. Deshmukh & Sanskrity Joseph, 2016. "Behavioural Finance: An Introspection of Investors Psychology," Indian Journal of Commerce and Management Studies, Educational Research Multimedia & Publications,India, vol. 7(1), pages 97-102, January.
    • Handle: RePEc:aii:ijcmss:v:07:y:2016:i:1:p:97-102
    as

    Download full text from publisher

    File URL: http://scholarshub.net/index.php/ijcms/article/view/231/224
    Download Restriction: no
    File URL: http://scholarshub.net/index.php/ijcms/article/view/231
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Markus Glaser & Thomas Langer & Martin Weber, 2007. "On the Trend Recognition and Forecasting Ability of Professional Traders," Decision Analysis, INFORMS, vol. 4(4), pages 176-193, December.
    2. Barberis, Nicholas & Thaler, Richard, 2003. "A survey of behavioral finance," Handbook of the Economics of Finance, in: G.M. Constantinides & M. Harris & R. M. Stulz (ed.), Handbook of the Economics of Finance, edition 1, volume 1, chapter 18, pages 1053-1128, Elsevier.
    3. George A. Akerlof, 2009. "How Human Psychology Drives the Economy and Why It Matters," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 91(5), pages 1175-1175.
    4. Frankfurter, George M. & McGoun, Elton G., 2002. "Resistance is futile: the assimilation of behavioral finance," Journal of Economic Behavior & Organization, Elsevier, vol. 48(4), pages 375-389, August.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Babli Dhiman & Saloni Raheja, 2018. "Do Personality Traits and Emotional Intelligence of Investors Determine Their Risk Tolerance?," Management and Labour Studies, XLRI Jamshedpur, School of Business Management & Human Resources, vol. 43(1-2), pages 88-99, February.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Ma, T. & Fraser-Mackenzie, P.A.F. & Sung, M. & Kansara, A.P. & Johnson, J.E.V., 2022. "Are the least successful traders those most likely to exit the market? A survival analysis contribution to the efficient market debate," European Journal of Operational Research, Elsevier, vol. 299(1), pages 330-345.
    2. Stefanescu, Răzvan & Dumitriu, Ramona, 2020. "Efectul Turn-of-the-Year pe piaţa valutară din România [The Turn-of-the-Year Effect in the Romanian foreign exchange market]," MPRA Paper 99365, University Library of Munich, Germany, revised 30 Mar 2020.
    3. Michael Demmler & Amilcar Orlian Fernández Domínguez, 2021. "Bitcoin and the South Sea Company: A comparative analysis," Revista Finanzas y Politica Economica, Universidad Católica de Colombia, vol. 13(1), pages 197-224, March.
    4. Committee, Nobel Prize, 2013. "Understanding Asset Prices," Nobel Prize in Economics documents 2013-1, Nobel Prize Committee.
    5. Stijn Claessens & M Ayhan Kose, 2018. "Frontiers of macrofinancial linkages," BIS Papers, Bank for International Settlements, number 95.
    6. Stijn Claessens & M. Ayhan Kose, 2017. "Asset prices and macroeconomic outcomes: A survey," CAMA Working Papers 2017-76, Centre for Applied Macroeconomic Analysis, Crawford School of Public Policy, The Australian National University.
    7. F. Cavalli & A. Naimzada & M. Pireddu, 2017. "An evolutive financial market model with animal spirits: imitation and endogenous beliefs," Journal of Evolutionary Economics, Springer, vol. 27(5), pages 1007-1040, November.
    8. Sabiou M. Inoua, 2020. "News-Driven Expectations and Volatility Clustering," JRFM, MDPI, vol. 13(1), pages 1-14, January.
    9. Bradley Jones, 2015. "Asset Bubbles: Re-thinking Policy for the Age of Asset Management," IMF Working Papers 2015/027, International Monetary Fund.
    10. Dumitriu, Ramona & Stefanescu, Răzvan, 2020. "Iluzii financiare, Partea întâi [Financial Illusions, Part 1]," MPRA Paper 101201, University Library of Munich, Germany, revised 17 Jun 2020.
    11. Cars Hommes, 2010. "The heterogeneous expectations hypothesis: some evidence from the lab," Post-Print hal-00753041, HAL.
    12. Berardi, Michele, 2021. "Uncertainty, sentiments and time-varying risk premia," MPRA Paper 106922, University Library of Munich, Germany.
    13. David V. Budescu & Ning Du, 2007. "Coherence and Consistency of Investors' Probability Judgments," Management Science, INFORMS, vol. 53(11), pages 1731-1744, November.
    14. Dohmen, Thomas, 2014. "Behavioral labor economics: Advances and future directions," Labour Economics, Elsevier, vol. 30(C), pages 71-85.
    15. Anat Bracha & Elke U. Weber, 2012. "A psychological perspective of financial panic," Public Policy Discussion Paper 12-7, Federal Reserve Bank of Boston.
    16. Fredrik Hansen, 2013. "The efficient-markets hypothesis after the crisis: a methodological analysis of the evidence," Chapters, in: Mats Benner (ed.), Before and Beyond the Global Economic Crisis, chapter 3, pages 55-71, Edward Elgar Publishing.
    17. J.E. King, 2011. "Four Theses on the Global Financial Crisis," Chapters, in: Steven Kates (ed.), The Global Financial Crisis, chapter 7, Edward Elgar Publishing.
    18. R. Andergassen, 2003. "Rational destabilising speculation and the riding of bubbles," Working Papers 475, Dipartimento Scienze Economiche, Universita' di Bologna.
    19. Anne Lavigne, 2006. "Gouvernance et investissement des fonds de pension privés aux Etats-Unis," Working Papers halshs-00081401, HAL.
    20. Stern, Nicholas, 2018. "Public economics as if time matters: Climate change and the dynamics of policy," Journal of Public Economics, Elsevier, vol. 162(C), pages 4-17.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:aii:ijcmss:v:07:y:2016:i:1:p:97-102. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Mr. Asif Anjum (email available below). General contact details of provider: .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.