Influence of Risk -Perception on Retail Investors’ Decision Making

Abstract

The root of behavioral finance study is relatively new and evolving subject in the field of finance which tells about the influence of investors’ perception while making investment decision making. The individual risk perception based on gender, age, income, investment portfolio and other demographic factors. The present study aims to investigate the impact of risk perception on retail investors’ decision making. In extent to this, the results of study concluded that retail investors’ decision making in equity investment is highly influenced by the individual level of perception. This is because;retail investors’ are very much financially conservative which arereflected by emotion, affective and cognition characteristics. In prevention, the investor should understand the diversified portfolio and market to reduce their risk level in investment decision making.