Impact of Demographic Factors on Retail Investors Investment Decisions - An Exploratory Study

Abstract

Since the economic liberalization, there is an increase in the number of investment avenues available for retail investors, depending upon his / her risk appetite, they can choose between bank deposits, government/ private bonds, shares and stocks, exchange traded funds (ETF), mutual funds, insurance, derivatives, commodities, currencies, etc. Every investment in the stock markets involves decision making, the outcome of which is unpredictable. This fact has fostered discussion ofrisk. There are many factors, both intrinsic and extrinsic like age, gender, marital status, level of income, educational background, etc that affect the assessment of risk and thereby investors' behavior and decision making. The present paper assesses the impact of demographic factors on retail investor's investment decisions.