THE INFLUENCE OF BEHAVIOURAL FACTORS ON FINANCIAL DECISIONS

Mr. Sumit Saini , Mr. Neeraj Vashishth

behavioral finance, classical finance, financial investor, investment decision, market efficiency, psychological factors, rational behavior.

Although finance has been studied for thousands years, behavioral finance which considers the human behaviors in finance is relatively a new area for study. Finance is considered as the life blood of every industrial concern. Every concern invests to meet their financial needs for better growth in future. But financial investment decisions are directly influenced in a large proportion by psychological and emotional factors. These behavioural factors may be enthusiasm, greed, fear, ambition, satisfaction, etc. Classical finance believes that investors are rational and they are focused to select an efficient portfolio, which means including a combination of asset classes chosen in such a manner as to achieve the greatest possible returns over the long term, under the terms of a tolerable level of risk. Financial investors are people with a very varied number of deviations from rational behaviour, which is the reason why there is a variety of effects. So, Behavioural finance utilises knowledge of human psychology to explain irrational investor behaviour that is not being captured by the traditional rational based models. The objective of the research article is to identify the behavioural factors and also find out the relationship between the factors and the financial decisions of the investors. To attain this objective various respondents from investment banks in Karnal have been studied through sequential structured questionnaire. Drop and pick later method was used to distribute the questionnaire and a pilot study was used to verify reliability and validity of the questionnaire. Descriptive statistics, chi-square test and correlation analysis were used to summarize the research findings. The outcome of these decisions gives the results in the form of investment performance and satisfaction to the different investors.

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"THE INFLUENCE OF BEHAVIOURAL FACTORS ON FINANCIAL DECISIONS", IJSDR - International Journal of Scientific Development and Research (www.IJSDR.org), ISSN:2455-2631, Vol.4, Issue 3, page no.557 - 560, March-2019, Available :https://ijsdr.org/papers/IJSDR1903097.pdf

Volume 4 Issue 3, March-2019

Pages : 557 - 560

Paper Reg. ID: IJSDR_190299

Published Paper Id: IJSDR1903097

Downloads: 000347180

Research Area: Engineering

Country: -, -, -

Published Paper PDF: https://ijsdr.org/papers/IJSDR1903097

Published Paper URL: https://ijsdr.org/viewpaperforall?paper=IJSDR1903097

ISSN: 2455-2631 | IMPACT FACTOR: 9.15 Calculated By Google Scholar | ESTD YEAR: 2016

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