Factors Influencing Investment Decisions of Individual Investors

Abstract

Investment decisions are based on investor’s psychology than onrational decision making. The study focuses on the factorsinfluencing investment decisions of investors in the Indian capitalmarket, with a sample size of 250 respondents using ANOVA, factoranalysis, and t-test for hypothesis testing. The variable can be
grouped in eight summary factors which captured investor’sdecisions. The results point out that the most impelling factors oninvestment decisions of investors are: financial requirements, adviceand recommendations, firm’s image, share price, dividendattraction, macro and micro analysis, higher earning perspective
and sector performance. The study also found that gender andthe demographic characteristics of investors statistically andsignificantly influence the investment choices of investors.