Socio-Demographic Determinants of Financial Behaviour of Individual Investors in India

Abstract

The purpose of the paper is to determine the socio-demographic factors that are significantly associated with the financial behavior of individual investors in India. A sample of 332 individuals were taken and a questionnaire was administrated to them. The various statistical tools like ANOVA and regression analysis were used to find out the socio-demographic factors which impact the financial behavior of individual investors. The findings of the research showed that various socio-demographic factors like age, household annual income, marital status, ownership of real estate, duration of investments and frequency of review of portfolio are significantly associated with the financial behavior of an individual. The two most dominating factors out of these factors are household annual income and duration of investments. The financial services industry is facing intense competition nowadays. The endeavor of the players in this industry is to understand their target segment so that they would be effectively tapping them for business. This paper would throw light on various socio-demographic factors which impact the financial behavior of an individual investor in India. This would help the financial institutions to direct their marketing efforts towards the right set of individuals who have the potential to become their customers.

Keywords: Financial Behaviour, Socio-Demographic Factors, Financial Services, Individuals, Investors

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