A Study on Novice Investor Behavior in Indian Stock Exchange

Abstract

Investing is not only a personal financial endeavor but also a critical driver of economic growth, shaping individual prosperity and national development. The research is significant because it emphasizes the critical role that financial literacy plays in influencing investment behavior. It also emphasizes the necessity of ongoing education and awareness campaigns to equip new investors with the information and abilities they need to make wise decisions on the Indian Stock Exchange. All things considered, the results provide insightful information that will help investors, financial institutions, and regulators develop policies to support a more knowledgeable, resilient, and inclusive investment environment in India. This study embarks on a journey to explore the intricate dynamics of investment in India, beginning with an exploration of its foundational role as the engine of economic progress. From influencing aggregate demand to shaping future productive capacity, investments yield significant influence over a nation's economic trajectory, fostering financial markets and enabling companies to raise capital for further growth. In addition, the research reveals that participants have a wide variety of investment objectives, with long-term wealth creation being the primary focus. Investment styles are characterized by a trade-off between risk and return, with moderate strategies being the most common, and considerable shares of aggressive and conservative methods. In emerging markets like India, where investor behaviors vary across a diverse spectrum, understanding the impact of different investor types becomes imperative. Delving into the distinct behaviors of individual, institutional, and foreign investors, this analysis sheds light on their contributions to the Indian stock market, unravelling their unique influences and dynamics.