Impact of Demographic Variables on Investment Decision Making

Page: 213-216
Sakshi Gupta and Sachin Sharma (Department of Management, CT University, Ludhiana, Punjab)

The behavior of the investor’s is influenced by many factors in making investment decisions. The present paper intends to study various demographic variables like (age, gender, education, income level & marital status) which influences the decision making power of the investors through a review of available literature. Behavior finance is based on emotions and cognitive psychology rather than being rational and calculative. Behavior finance is a field of study that helps us to understand how various demographic variables can impact investment decision making. Investment is a very important part of wealth creation and behavior plays a very important role in creating wealth and making investment decisions. Investment is the skill of allocating resources with the expectation of generating an income or profit in the future. Investment decision making means how funds are to be invested in different assets so that it will give maximum possible return to the investors in the coming future. Demographic variables play a very important role in making investment decisions. They also influence the risk tolerance and investment preferences of the investors. So, it is very important to understand the impact of demographics on the decision making power of investors. The present paper reviewed various studies to create an understanding of the impact of demographic variables on investment decision making. The paper concluded that some demographic variables have an impact on investment decision making while others have no impact on investment decision making.