Investment is the backbone for any economy to thrive and prosper. Individuals invest with an opportunity to earn extra income and render their future needs. However, with the heap of investment options available in today's financial market, investor's decision to choose and invest in different instruments becomes a perplexed task. There are a bundle of factors that affect investor's decisions to put their money in a certain financial instrument. This paper attempts to explore those critical factors that affect an investor to take his investment decisions by using principal component factor analysis technique. A standard questionnaire was filled by 180 respondents and using SPSS the data collected streamlined 5 factors namely awareness and knowledge of the financial market, risk perception, diversification, time horizon and income and priorities.
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