Authors : Neha Agarwal, T.V. Raman, Ashok Sharma and Vinamra Jain
Abstract: Today, many types of investment options are available with the investors, whether to invest in real assets or financial assets. Investors are loaded with information to choose an appropriate portfolio. The securities industry is a gigantic machine for extracting money from ordinary investors, does so in a way that makes it all seems perfectly reasonable. But there are some unconscious drivers that affect the way investors make decisions about money, what we called is behavioral biases. There are different types of behavioral biases which intend to kick away any illusions you have about yourself and your investing abilities and trample them into the dust. These biases can be caused by due to time cost and capacity constraints, insufficient information, information overloaded/distractions and resistance to change. In this research, we will study what is the most preferable tool of investment by both male and female and how investment decisions are affected by two well known behavioral phenomena: loss aversion and illusion of control. Loss aversion theory is related to the individual desire to avoid losses than comparable profits. Illusion of control is defined as the propensity of people to believe that they can control or affects the output that in reality they have no control over. Empirical data will be collected from questionnaire. Sample size will contain 100 investors. Multiple regression model and other suitable techniques will be used to investigate the objectives.
Neha Agarwal, T.V. Raman, Ashok Sharma and Vinamra Jain, 2016. Behavioral Biases Affecting Investors Attitude. The Social Sciences, 11: 3643-3647.