An Analytical Study of Investment Decision-Making Behaviour among Youth in India

Abstract

Increased involvement of youth in financial markets has turned investment decision making behaviour to a significant field of academic as well as policy-based studies in India. This paper was an attempt to critically discuss youth investment behaviour through determining the driving tablets behind their investment decision. It had an adopted descriptive research design, with primary data being gathered using a structured questionnaire sent to 384 youth respondents in India. A descriptive statistic and inferential analysis were used to evaluate the investment preferences, risk-taking, financial literacy, and behavioural variables. The results show that the most desirable investment channels among young people are equity shares and mutual funds, which means that there is an increasing tendency towards investment related to the market. Membered in aspect of expected returns and risk perception were found to be most important determinants of investment decisions with financial literacy being statistically significant source of association with investment behaviour. The more financially literate youth were found to be more engaged in growth-intensive means of investment, as less financially literate youth were engaged in less safe and more traditional means of investment. The research suggests the applicability of behavioural finance in the context of investigating youth investment behaviour as well as the need to impose specific financial education and policy programs that can help instil informed, balanced and sustainable investment behaviours among the Indian youth.