A STUDY OF ATTITUDES AND TRADING BEHAVIOR OF STOCK MARKET INVESTORS

C. Shylajan and Sushama Marathe

The IUP Journal of Financial Economics, 2006, vol. IV, issue 3, 54-68

Abstract: This study identifies the major factors responsible for determining the attitudes and trading behavior of stock market investors. The main factors which have been identified from the review of literature are confidence level that an investor has as compared to informal sources, control over his investments, risk taking ability, confidence of the investor as compared to formal sources such as financial analysts, and advisors, expectation to perform better than the stock market and short-term investment attitude. Based on these identified dimensions, a survey was carried out to understand this complex behavior of individual investors. Factor analysis was done to get down to the main factors that influence the investor behavior. Further, the individual investors were segmented. The segmentation was based on their shared investing attitudes and behavior. Cluster analysis was used to carry out the segmentation. Cluster segmentation approach identified two main segments of individual investors: aggressive investors, and non-aggressive investors.

Date: 2006
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Persistent link: https://EconPapers.repec.org/RePEc:icf:icfjfe:v:04:y:2006:i:3:p:54-68

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