An Evaluation of the Factors Influencing Investors' Perception in Bangladesh Stock Market

Abstract

Behavioral finance deals with the influence of psychology on the behavior of financial practitioners and its subsequent impact on stock markets. Unlike the developed part of the globe, very limited research attempts have been undergone so far in the field of investors' behavior in the growing stock markets. However, the decisions of investors in an emergent market are generally influenced by behavioral finance rather than conventional finance. Thus, this study aims at analyzing the general behavior of individual investors in Bangladesh in terms of the factors affecting their stock market perception. The study is mainly based on primary data, collected particularly in the context of Bangladesh. In exposing the factors affecting the perception of individual investors, a number of statistical techniques under univartate, bivariate and multivariate analysis have been applied using SPSS. According to the study, Accounting Information is the most important factor influencing investors' decision, whereas Company Specific Attributes or Reputation is the least important factor. The findings of the study may offer important implications to the concerned parties, especially to the actual and potential investors, corporations’ management, investment managers, regulatory body, etc.