Investor Preferences Research Articles

Competitiveness of the enterprise from the investor's point of view based on the utility function

The quality of the services and goods produced is the primary factor affecting the competitiveness of the enterprise. Product quality management allows you to improve the consumer characteristics of the properties of goods and services. The higher the usefulness of the products produced by the enterprise for the buyer, the more the buyer is inclined to purchase these products, and therefore this enterprise has a higher competitiveness. At the same time, the potential investor of the enterprise evaluates the enterprise as a potential object for investment from the point of view of the competitiveness of this enterprise. The higher the value of the competitiveness of the enterprise, the higher its investment attractiveness, due to the fact that investors are primarily interested in the ability of the enterprise to produce competitive products, which means to profit from its sale. At the same time, investors have different attitudes to risk. With the same utility function for a more conservative investor, the value of profitability and risk R will be less than the value of risk propensity for a more risk-prone investor. Thus, a more conservative investor perceives an investment in this enterprise as more profitable than a riskier investor. In addition, taking into account it can be concluded that if the utility functions coincide, then the competitiveness of the enterprise seems to be higher to a conservative investor than it would seem to a riskier investor. Competitiveness, from the investor's point of view, is a subjective indicator that depends on the investor's investment preferences.

Устойчивое финансирование в новых политических и экономических реалиях

The article reviews recent trends in sustainable finance development. The new economic and geopolitical challenges resulted in volume decrease of the sustainable debt market in 2022. Still the estimates for the next year and especially in the mid and long term are more optimistic. Besides the falling markets the analysis shows qualitative changes in project structure as well as in investment preferences. Though the decarbonization maintains its dominant position as green finance priority, the nature and biodiversity protection attracts more and more attention. The energy transition became better tailored to national interests and very often accepts transition financing of the so-called brown industries. Alongside with green finance during COVID?19 pandemic and after the socially responsible finance continues to enlarge its importance. The focus of the research is also the rapid growth in the last years of the climate and other ecological risks as well as financial regulators policies at different levels (national, regional, global) to mitigate these risks. The author came to the conclusion that the elaboration of the sustainable finance principles and standards, including the disclosure of non-financial information and, to some extent, measures against greenwashing are more or less successful. Still, the real flows of capital and the role of private finance are still insufficient to achieve the declared goals, especially what concerns the development finance. It is evident that the global problems of climate change and environmental disruption can be solved only by the global cooperation of all countries.

Regional Investment Preference and Corporate Risk-Taking: Evidence from China

As an important part of corporate value, risk-taking has always been the focus of scholars. The existing research mainly focuses on the impact of corporate shareholders and managers' personal characteristics on corporate risk-taking, and few scholars study it from the perspective of regional environment. Based on the sample of Chinese A-share listed companies from 2006 to 2020, this paper empirically tests the impact of regional investment preferences on corporate risk-taking by using multiple regression methods; Then, the instrumental variables and propensity matching methods are used to test whether the main regression results have changed; Furthermore, this paper explores the mechanism of regional investment preference to reduce the level of corporate risk-taking; Finally, the impact of industry intensity and policy uncertainty on the main regression results will be tested in an expanded way. The research results show that the stronger the investment preference of the region where the company is located, the lower the company's risk-taking. After a series of robustness tests such as instrumental variable method and propensity score matching method, the main regression results of this paper remain unchanged. The mechanism test shows that regional investment preference can reduce managers' overconfidence and improve the quality of internal control, thereby reducing the level of corporate risk-taking. Further research shows that fierce industry competition and policy uncertainty can enhance the impact of regional investment preferences on corporate risk-taking. The research results not only enrich the research on the factors affecting enterprise risk-taking, but also deepen the theoretical understanding of the impact of the regional environment on corporate governance, which has certain reference significance for further improving corporate governance, optimizing corporate risk-taking and enhancing corporate value.

A Study on Investment Preference Among Gen X, Millennials and Gen Z With Special Reference to Chennai City

A Study on Investment Preference Among Gen X, Millennials and Gen Z With Special Reference to Chennai City

Optimizing Portfolio Management using Mean-Variance Optimization in Python

Portfolio management refers to the process of managing a collection of investments, known as a portfolio, intending to achieve optimal risk-adjusted returns. Portfolio management involves selecting the appropriate mix of investments to achieve a specific financial objective, such as capital appreciation, income generation, or risk reduction. A portfolio manager is responsible for constructing and maintaining a portfolio that aligns with the investor's financial goals, risk tolerance, and investment preferences. This involves conducting research and analysis to identify investment opportunities, evaluating the risk-return tradeoffs of different assets, and monitoring the performance of the portfolio over time.Portfolio management offers several advantages to investors. One of the primary advantages of portfolio management is diversification. By investing in a range of assets such as stocks, bonds, and alternative investments, investors can spread their risk and reduce the impact of any single asset or sector on their overall portfolio performance. Diversification can help investors achieve a more stable return on investment over the long term (Investopedia, 2021). Portfolio management helps investors manage risk by balancing their exposure to different asset classes and sectors. By constructing a well-diversified portfolio, investors can reduce the risk of losses due to market volatility, economic downturns, and other external factors. Portfolio managers can also use risk management tools such as stop-loss orders and options to protect against downside risk (Investopedia, 2021). Portfolio management also offers investors the flexibility to adjust their investment strategies according to their changing needs and objectives. Investors can change their asset allocation, rebalance their portfolios, and adjust their risk profiles to suit their individual preferences and circumstances. Portfolio managers can also respond quickly to changes in market conditions and adjust their investment strategies accordingly (Investopedia, 2021). Portfolio management offers investors access to professional expertise and experience. Portfolio managers have a deep understanding of financial markets, investment strategies, and risk management techniques. They can provide investors with personalized investment advice, identify potential risks and opportunities, and help them achieve their long-term financial goals (Investopedia, 2021).

Exploring the Nexus: Financial Literacy, Risk Attitude, and Investment Preferences among Youth in Uttarakhand

This study delves into the intricate relationship between financial literacy and risk attitude in shaping the investment preferences of young individuals in India, with a specific focus on the context of Uttarakhand. The primary objective is to unravel the correlation between these two critical factors and their impact on the investment decisions made by young Indians. Employing an exploratory, descriptive, and quantitative research approach, data was collected from a sample of 211 respondents through a questionnaire employing a five-point Likert scale. The collected data was subjected to analysis using Partial Least Squares Structural Equation Modeling (PLS-SEM). The findings of this research reveal a notable connection between the risk attitudes of individuals and their investment choices, as well as the level of financial literacy they possess. These results strongly indicate that the investment decisions of the youth in Srinagar Garhwal are significantly influenced by their financial knowledge and their propensity for risk-taking. These outcomes align harmoniously with the findings of previous studies on related subjects. Importantly, this study underscores the imperative of promoting financial literacy among young individuals, emphasizing the vital role it plays in shaping their investment decisions.

A Study on Impact of Pandemic on Changes in Investment Pattern with Special Reference to Chennai City

Investment is an integral part of an individual and his family as well. The objective of investment varies from individual to individual. One may invest for various reasons like to meet uncertainties without any financial hardships, educational purposes or maybe for any events which require huge amounts instantly. Also, one invests to grow his wealth and multiply his current wealth to manage well with the inflation rates in the economy and to become financially strong and independent. The COVID-19 pandemic has had a profound impact on investment patterns and preferences. But during this pandemic many people’s earnings and its pattern were disturbed due to the deadly virus both positively and negatively. Some people started to try out new investment alternatives like crypto currencies, mutual funds, REITs, NFTs, ETFs etc., whereas some liquidated their investments to meet the uncertainties financially. This study concentrates about the major causes for the change in investment pattern of retail investors during the pandemic and explores the factors driving the shift in investment behavior during the pandemic. The objectives of this study were to discover the causes for the change, the reasons for trying out new investment alternatives by retail investor, their perceptions regarding investments and to study the liquidity and necessity needs of the investors during the pandemic. A descriptive survey design was used in this study. Primary data was used to proceed with the study and these data collected using a self-designed questionnaire using Likert 5-point scale, few close ended questions and a few checkboxes for questions on their preferences. To collect the data from the retail investors, the convenient sampling and snow ball sampling techniques were used. The study’s target population was 156 retail investors across all age groups. The statistical tools like One-way ANOVA tests, independent sample ttest and correlation tests were used to analyze the collected data. From this study we conclude that the major factors influencing the changes in investment preferences and pattern were interest to take risks, influence of pandemic by means of time and need for passive income and objective to earn higher returns.

A study of preference of individual investor towards investment in stocks

Individual behaviour in terms of investment is influenced by various factors that might change the decision making of the individual. The study is conducted to determine the perception and investors’ behaviour regarding investment in stocks, factors considered while investing in stocks and to determine the reason for not investing in stocks. This research paper is a result of primary data that is collected by 330 respondents. The study found background of the company, expected return, FII interest, statistics of daily stock activities, and promoters shareholding as the important factors behind taking the investment decisions in the stock. The study also found the reasons for not investing in stocks are risk involved, lack of awareness and they have other preferences for the investment. The study found Gender, Age And Occupation as the significant factors and annual income and education as the non-significant factors while taking investment decisions.

Dynamic Implied Risk Aversion Term Structure: An Empirical Analysis Based on Shanghai Stock Exchange 50 ETF Option

Risk preference has constantly been one of the vital issues in economics and finance. In this study, the time series and term structure of Chinese investors’ implicit risk aversion are investigated using the implicit risk aversion extraction method, and the dynamic term structure of Chinese investors’ implicit risk aversion is modeled using the Vasicek model. In the empirical process, the SSE 50 ETF option data from March 2015 to July 2018 are adopted to extract model‐free risk‐neutral skewness. The standard deviation, skewness, and kurtosis of reality measure are extracted using the Shanghai 50 ETF data, and then the monthly implied risk aversion time series and term structure of Chinese investors are obtained. As indicated by the results of this study, the risk preference of Chinese investors exhibits significant time series characteristics, and it will show risk‐loving and risk‐averse phenomena at certain times. Moreover, for different periods in the future, differences are generated in investors’ risk preferences, suggesting an aversion to short‐term risk and a certain tolerance for long‐term risk, i.e., there are significant characteristics of the term structure. Besides, the term structure of implied risk aversion of Chinese investors is dynamically modeled using the Vasicek model. To be specific, its first principal component can account for 90% of the change in the term structure. The “level factor” refers to the critical factor load, and the level of long‐term implied risk aversion reaches 0.658. Furthermore, the term structure of implied risk aversion exhibits the characteristics of mean regression. Next, more effective research results on investors’ risk preference are achieved, and the time‐varying characteristics and term structure characteristics of investors’ risk preference are investigated. The result suggests that the long‐term risk preference of Chinese investors approaches 1, and there is a significant feature of “mean regression,” i.e., a vital finding of this study.

Role of Social Media Information in Influencing Investment Preferences of Retail Investors: An Empirical Study

Role of Social Media Information in Influencing Investment Preferences of Retail Investors: An Empirical Study

Inferring Investor Preferences for Sustainable Investment from Asset Prices

Inferring Investor Preferences for Sustainable Investment from Asset Prices

Time Is Not Money! Temporal Preferences for Time Investments and Entry Into Entrepreneurship

Time Is Not Money! Temporal Preferences for Time Investments and Entry Into Entrepreneurship

Investor Tastes: Implications for Asset Pricing in the Public Debt Market

Some firms create innovative financial debt and equity products to attract specific investor tastes (i.e., non-monetary preferences unrelated to expected cash flows). Innovations can be costly, but they may also widen a firm’s investor base, leading to a reduction in the cost of capital. Prior research is inconclusive about whether tailoring financial products to meet specific investor tastes affects asset pricing, which I posit stems from a lack of consensus on which assets satisfy a particular taste. My research design, however, avoids this ambiguity by testing the relation between asset pricing and an objectively identified investor taste—a taste for Shariah-compliant investments, which is satisfied via Islamic Finance. Using Malaysian data, I estimate price differences between conventional and Shariah-compliant bonds over an eight-year period (2005 to 2013). I find that an investor taste for Shariah-compliant bonds significantly affects bond pricing. These results hold even after controlling for issuer and issuance characteristics, including differences in covenant types, as well as the possibility that price and demand may be simultaneously determined. I also find evidence that investors with a taste for Shariah-compliant bonds have a significantly different demand distribution than investors without this taste, corroborating my assertion that a preference for Shariah-compliant investments is a distinct taste. Overall, my results are consistent with investors taste affecting the cost of capital.

Population Aging and Preferences for Government Investments and Public Debt

Population Aging and Preferences for Government Investments and Public Debt

Investor preferences for positive social externalities and state-owned enterprises’ facilitated access to capital

State-ownership of commercial companies exists around the world, and it is important to understand its effect on financing and investment decisions. Empirically, firms that are partially state-owned (SOE) usually profit from easier access to capital. We propose a novel explanation for this: investors’ prosocial preferences can affect capital allocation if SOEs are perceived as socially beneficial. In support of this we found that people attribute social benefits more to SOEs than to private firms, and their propensity to invest depends on this attitude. Further, in an incentivized modified stochastic public good game, participants invested in risky options with positive externalities even when the aggregate of private return and externality was lower than the return of an investment option with only private returns. For the case of the EU, we discuss alternative explanations such as state guarantees and political lending in the light of regulations of state aid. We conclude that even if these regulations prohibit direct or indirect state aid for SOEs, state-ownership can affect capital allocation through investors’ prosocial preferences.

Green or Greenwashing? How Manager and Investor Preferences Shape Firm Strategy.

Green or Greenwashing? How Manager and Investor Preferences Shape Firm Strategy.

Venture Capital Research—Investor Preferences and Success Factors for Startups

Venture Capital Research—Investor Preferences and Success Factors for Startups

Fund selection or star gazing Analysing retail investors’ preferences for mutual fund selection using conjoint approach

Fund selection or star gazing Analysing retail investors’ preferences for mutual fund selection using conjoint approach

The management of saving and investment pattern of the private sector employees of Assam and the effect of COVID-19 on it - an analytical study

When the nation is facing a great downfall of economic activities leading to many disturbances in the daily life of people, savings and investment plan can hold the hands of employees belonging to private sector from financial fall down. The present study exposes the savings and investment preferences of private sector employees due to the effect of COVID-19 pandemic. As information shows that salary reduction and job termination have become common events in private sector due to the present pandemic, it becomes necessary to understand how far the pandemic has influenced their savings and investment. Likert scale and Garret ranking are two statistical tools used in the study to analyse major influencing factors of COVID-19 pandemic and the mostly preferred factor by the private sector employees. The study concludes that this pandemic has a significant influence leading to deregulating existing plans as well as decline in proportion of savings and investments.

Supporting or Deteriorating: Local Cultural Forces, Mobility Expectations and Investment Preferences based on the changes in the selection system of the Qing Dynasty

Supporting or Deteriorating: Local Cultural Forces, Mobility Expectations and Investment Preferences based on the changes in the selection system of the Qing Dynasty