INVESTORS BEHAVIOUR IN VARIOUS INVESTMENT AVENUES …...of investment avenues are available . In the above mentioned avenuesall the investors invest their surplus money based on their

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INVESTORS BEHAVIOUR IN VARIOUS

INVESTMENT AVENUES POST COVID 19.

Tejas Bannore1 ,Dr.VinitaAhire Kale2

1Student, 2Professor

1MIT School Of Management,WPU,

Pune,Maharashtra,India.

[email protected], [email protected]

Abstract This research study deals with the behaviour of the investor to identify the better investment avenues available in India after impact of covid 19.For an investors Investment Strategy is a plan which helps an investors to choose most suitable investment option with minimum risk to achieve their financial goal within some time period.Doing an Investment helps investors to increase their individual wealth and it also helps to overall growth of economy.The process of investments helps various companies to raise their capital through financial market.Some types of investments provides many benefits to the investors ,corporate as well as society also.Indian investors are very well known about the concept of risk and return in their investment also these investors always follows “Prevention is better than Cure”i.e. they expect more income with minimum risk.

Key words: Investment Strategy, Investment Portfolio, Risk and Return.

Introduction

Investment is one of the important part of the any investors as well as nations economic growth.With this investment in various available option by investors acts like a driver in the growth of the economy of that country. Indian financialscene is too presents a too much of avenues to the investors. It is not the best or deepest of markets in the world, it has a reasonable options for an common man to invest his savings.

Investment benefits both economy and the society. It is an outgrowth of economic development and the maturation of modern capitalism.For our economy aggregate investment in the current period is a major factor to determine aggregate demand and employment level also. In the long term, current investment determines the economy’s future productive capacity and, ultimately, a growth in the standard of living.Investing in any avenue can

Journal of Seybold Report ISSN NO: 1533-9211

VOLUME 15 ISSUE 9 2020 Page: 1757

mailto:[email protected]

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contribute to economic growth and prosperity and also for increase in personal wealth. The process of investing helps to create financial markets where companies can raise capital. It also contributes in the greater economic growth and prosperity. Investment in the specific type of avenues provides others benefits tp society as well.

INVESTOR

An investor is any person or other entity such as firm who makes an investment into one or more categories of assets-equity, debt securities, real estate, currency, commodity, derivatives such as put and call options, etc. with the objective of making a profit in return.

INVESTMENT

Investment is an purchasing any good or asset or investing money with the aim of creating wealth and with idea that will give income in future with more profit.These investment options are available with various risk rewards trade offs.An proper understanding of the core concepts of investment and a thorough analysis of the available options can help an investor create a good portfolio that maximizes returns while minimizing risk exposure.

INVESTMENT OBJECTIVES The main objective of investor for investment to earn profit with minimum

risk.Safety,Liquidity are the subsidiary objectives of investors. RETURN Any investor want good rate of return on their investment. Rate of return can be defined as total percentage gain on the beginning value of the investment with ending value of investment.

RISK Risk can be define as possibility of losing money or investment from your total investment. The word risk is also called as variability of return.

LIQUIDITY

Liquidity can be define as how any assest can be converted into cash without affecting market price. HEDGE AGAINST INFLATION



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Almost all economy have inflation and they reduces the value of investment. The rate of inflation should be less than rate of return otherwise investors will face lossesThe return thus earned should assure the safety of the principal amount, regular flow of income and be a hedge against inflation.

SAFETY

Investors have to invest in avenue which is legel and have regulatory framework for their safety of investment. If it is not under the legal framework, it is difficult to represent the grievances, if any. Approval of the law itself adds a flavour of safety.

Various Investment options in India

:- Savings Bank Account

:-Money Market Funds (also known as liquid funds)

:- Bank Fixed Deposit (Bank FDs)

:- Post Office Savings Schemes (POSS)

:- Public Provident Fund (PPF)

:-Company Fixed Deposits (FDs)

:- Bonds and Debentures

:- Mutual Funds

:- Life Insurance Policies

:- Equity Shares

:- Gold

:- New Pension Scheme

:- Real Estate

:- Government Securities

:- Land

OBJECTIVES OF THE RESEARCH PROJECT



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1.To study the various alternatives of investment which are available in the market.

2.To study the investors preference towards the investment post covid 19.

3.To find out how investors are motivated to invest in various financial instruments.

4.To identify the objective of Investments post covid 19.

REVIEW OF LITERATURE



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Generally every individual investors follows some principles while investing their money i.e. proper allocation of investible funds,some strategy to maximize return and long term approach for investment. While applying these three principles every investors has to deal with his investment psychology and lifestyle also.

Investors age, occupation and income plays and important role in the choice of investment avenues. Many times investors choice affected by the overconfidence,reference group and also by framing of other alternatives.The knowledge of these aspects is important to all including students ,researchers, financial consultunts etc. .(Dr. (Mrs.) SushantNagpal, 2007, Psychology of Investments and Investor’s Preferences )

In this paper researchers discusses about the basic of investment and need for investment. Investment benefits both economy of the country and the society also. It is an outgrowth of economic development and the maturation of modern capitalism.For the economy of the country aggregate investment plays an major factor role in determining the aggregate demand and the level of employment.In the long term current investment helps to determine the productive capacity of the economy of the country and the growth in the standard of living also.Investment helps investors to increase his personal wealth and can also contribute in economic growth and prosperity of country.(Dr.A.P.Dash, Sr.Faculty, PMI, Basics Of investment)

According to this research paper today indian investors have to endure a sluggish economy,insidertrading,illegal corporate accounting practices like Satyam etc.Performance in the stock market is not always the result of intelligible characteristics but also due to the emotions that are still baffling to the analyst.Investors emotions like fear, overconfidence ,risk aversion etc decisively drives the fortunes of market.(Ms.M.KothaiNayaki&Mrs.P.Prema, A Study on Indian Individual Investors’ Behavior.)

Investments are made with an avowed objective of maximising wealth.Ifinvestors takes decision on available information rather than taking on emotions it eill be help them to maximise their return. Behaviour of investors is characterised by his excitement and his reaction in both rising and falling stock markets. Investments and financial theories are based on ideas that everyone takes care before taking any investment decision.This research is conducted to analyse the factors influencing the behaviour of investors in capital market. Empirical evidence suggests that demographic factors influence the investors' investment decisions.How investor acts on various capital market information and interprets to make informed investment decisions, is also investigated by this research article.(V. Shanmugasundaram and V. Balakrishnan, 2011, Investment decision-making – A Behavioural Approach).



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According to this research articlesafety of principal amount, liquidity, income stability, appreciation and easy transferability are major features of an investment. Shares, bank, companies, gold and silver, real estate, life insurance, postal savings and so on are the variety of investment avenues are available . In the above mentioned avenuesall the investors invest their surplus money based on their risk taking attitude.( SonaliPatil, Dr.KalpanaNandawar ,2014 - A Study on Preferred Investment Avenues Among Salaried People With Reference To Pune, India)

The researcher of this paper concluded that Investors are very well aware about investment avenues that are available in Pune, India but still bank deposite and real estate are the prefferd options of investors of investing money. The data analysis of research reveals thatwhile doing investment the safety is concerned as important factor, so that’s why other available avenues are less considerable while doing investment by investors.

Real estate is always on the high or up Especially in a city like Pune this is not at all bad investment option ,But the risk and amount of investment is high and there is no fixed return.

It is absolutely essential and needed to save what you earn, to have a plan for your own future, and to resist the spending funds that you do not already have.(Prof.SanketL.Charkha&Dr.Jagdeesh R. Lanjekar - A Study Of Saving And Investment Pattern of Salaried Class People with Special Reference To Pune City (India))

RESEARCH METHODOLOGY

RESEARCH DESIGN:



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Simple framework of plan for a study that guides the collection and analysis of data called as Research Design. This study has intension to find the investors preference towards various investment avenues. The study design is Descriptive in nature.

A fact-finding investigation with adequate interpretationcalled Descriptive Research . It is the simplest type of research and is more specific. Mainly designed to gather descriptive information and provides information and provides information for formulating more sophisticated studies.

SAMPLING DESIGN:

Selection of the sample size: 98

SAMPLING METHODS Convenience method of sampling is used to collect the data from the respondents. Researchers or field workers have the freedom to choose whomever they find, that’s why it is “convenience”.

DATA COLLECTION

Primary data – collected through Structured Questionnaire.

Secondary data – Earlier records from journals, magazines and other sources.

STATISTICAL TOOLS USED FOR ANALYSIS

Percentage Analysis

T Test

Pie Chart

Bar Chart

Limitation Of the Study

The information can be biased due to use of questionnaire.

The Researcher can concentrate only in Indian Investors.

DATA ANALYSIS AND INTREPRETATION

Age Wise Classification



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Age No of Respondent Percentage 20 – 40 years 92 93.9% 40 – 60 Years 06 6.1%

Inference:-

The above analysis shows that 92 respondent are from the age group 20 – 40 years which is equal to 93.9% of total respondent and remaining 6 respondent i.e. 06.1% of total respondent are from 40 – 60 years age group.

Occupation wise classification:-

Occupation No of Respondent Percentage Student 67 68.3% Salaried 27 27.6% Businessman/women 3 3.1% Home-Maker 1 1% Inference:-

92

6

00

Age

20-40 year 40-60 years



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The above analysis shows that 67 respondent out of 98 are from student background which is equal to 68.3% also 27 respondent are salaried ,3 are from business background and 1 is home maker which are 27.6%,3.1% and approx. 1% respectively of total respondent.

Income wise classification:-

Inference:-

The above analysis shows that 77.5% respondent which are 77 of total 98 respondent have up to 2.5 lac income and the respondent who have 2.5 – 5 lac,5 – 10 lac and10 lac and above income are 12, 7 and 3 respectively which are equal to 12.2%,7.1% and 3.1% respectively of total respondent.

67

27

3 1

Occupation

Student Salaried Businessman/women Home-Maker

Monthly income No of Respondent Percentage 0 – 2.5 lac 76 77.5% 2.5 – 5 lac 12 12.2% 5 – 10 lac 7 7.1% 10 lac and above 3 3.1%



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Liquidating cash amid this crisis wise classification

Want to liquidate cash No of Respondent Percentage Yes 51 52.6% No 46 47.4%

Inference:-

The above analysis shows that 52.6% respondent want to liquidate their cash amid this crisis which is equal to 51 respondent and 46 respondent don’t want to liquidate their cash amid this crisis which is equal to 47.4%.

76

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73

Income

0 – 2.5 lac 2.5 – 5 lac 5 – 10 lac 10 lac and above



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Frequently investment wise classification

How Frequently No of Respondent Percentage Daily 6 6.7% Weekly 13 14.4% Monthly 30 33.3% Quarterly 22 24.4% Yearly 19 21.1%

Inference:-

The above analysis shows that 6 respondent invests daily out of 90 respondent which is equal to 6.7% likewise 13,30,22 and 19 respondent invests weekly,monthly,quarterly and yearly respectively out of 90 respondent which is equal to 14.4%,33.3%,24.4% and 21.1% respectively.

51

46

Want to Liquidate your cash amid this crisis?

Yes No



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Awareness level wise classification

Level of awareness No of respondent Percentage High 10 10.6% Medium 18 19.1% Low 66 70.2%

Inference:-

The above analysis shows that 10 respondent out of 94 have high level of awareness about investment schemes which is equal to 10.6% likewise 18 and 66 respondent have medium and low level of awareness respectively which is 19.1% and 70.2% respectively of totat respondent.

6

13

30

22

19

Frequently Investment

Daily Weekly Monthly Quarterly Yearly



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Preferance of investment wise classification

Preferance No of respondent Percentage Saving bank account 45 45.9% Money market fund 4 4.1% Bank FD’s 45 45.9% POSS 16 16.3% PPF 14 14.3% Company FD’s 8 8.2% Bonds and debentures 2 2% Mutual Funds 31 31.6% Life Insurance policies 18 18.4% Equity Shares 31 31.6% Gold 43 43.9% New Pension Schemes 3 3.1% Real Estate 29 29.6% Government Securities 5 5.1% Crypto-currency 1 1% Land 1 1%

Inference:-

The above analysis shows that respondents preference is more towards saving bank account and bank fd’s rather than any other preference which is equal to 45.9% of total respondentafterwords respondent prefers gold , equity shares and real estate as a investment

10

18

66

Awareness Level

High Medium Low



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option 43.9%,31.6% and 29.6% respectively of total respondent. 18.4%,16.3%,14.3%,8.2%,5.1%,3.1%,4.1%,2%,1% and 1% respondent of total respondent chooses Life insurance policies,Post office saving schemes, PPF, Company FD’s, Government securities, Money market funds,New Pension Scemes,Bonds and debentures,Crypto- currency and land respectively.

Risk Wise Analysis

Preferance Not Risky Less Risky Intermediate High Risky Very High Risky

Saving Bank Account

53 34 8 - -

Money market fund

4 47 33 9 2

Bank FD’s 45 36 14 - - POSS 42 37 16 - - PPF 30 40 22 2 2 Company FD’s

13 43 33 4 2

Bonds and debentures

4 45 35 10 1

Mutual Funds

5 29 36 17 8

Life Insurance Policies

20 42 28 05 -

Equity Shares

4 31 32 14 14

Gold 23 39 28 3 2

05

101520253035404550

Preferance of Investment

No of respondent



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New Pension Schemes

16 45 33 1 -

Real Estate 14 36 25 13 07 Government Securities

27 42 22 3 1

Crypto Currency

27 8 62 - -

Land 57 20 15 - -

Inference:-

Above analysis shows that, respondent thinks that saving bank account , Bank FD’s ,Post Office Schemes,PPF,land these are investment are not risky ,money market fund, bonds and debentures,life insurance policies,new pension schemes real estate and government securities are less risky investment options also otherside equity share,mutual funds and cryptocurrency has intermediate level of risk than any other investment options.



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0 10 20 30 40 50 60 70

Saving Bank Account

Money market fund

Bank FD’s

POSS

PPF

Company FD’s

Bonds and debentures

Mutual Funds

Life Insurance Policies

Equity Shares

Gold

New Pension Schemes

Real Estate

Government Securities

Crypto Currency

Land

Chart Title

Very High Risky High Risky Intermediate Less Risky Not Risky



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Objectives of savings wise analysis

Education Vacation Future Plans Others(Business,emergency,lifestyle,etc.) 20 17 21 46

Inference:-

Above analysis shows that most of the respondents objectives of savings is for completing their luxury wishes, for business purpose for emergency purpose followed by future plans which includes built a house ,buying car etc and then for education and for vacation are also the reasons behind savings.

Impact of covid 19 on Income wise analysis

Preferance No of Respondent Percentage Yes 64 65.3% No 34 34.7%

20

17

21

46

Objectives of Savings

Education Vacation Future Plans Others(Business,emergency,life style,etc.)



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Inference

Above analysis shows that 64 respondents income is impacted by covid 19 out of 98 which is equal to 65.4% and remaining respondents imcome is not impacted by covid 19.

How your Income Impacted by covid 19 wise analysis

Preferance No of Respondents Percentage Pay Cut 40 40.8% Lost My Job 15 15.3% Expenses Increases 33 33.7% Financial Situation Improved

18 18.4%

Stopped Investing 23 23.5% Withdraw their Investment 09 9.2%

Inference

Above analysis shows that 40.8% respondent facing pay cut due to covid 19 which are equal to 40 out of 98 respondent and 15.3% respondent lost their job due to covid 19.33.7% respondent said that their expenses increases due to covid 19 ,23.5% respondent stopped investing their money in various available avenues and 9.2% respondent withdraw their investment from market.

64

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Impact of Covid 19 on Income

Yes No



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Uses of money in this pandemic wise analysis

Preferances No of respondents Percentage For paying rent and utility bills

40 40.8%

To pay debts 26 26.5% Putting in sefty net funds 16 16.3% Put towards investment 16 16.3%

Inference

Above analysis shows that 40 respondent out of 98 which is equal to 40.8% are used their money for paying rent and other utility bills followed by 26.5% respondent to pay debts. 16.3% respondent which is equal to 16 respondent out of 98 used their money for putting in sefty net funds and same number of respondent used their money for putting towards investment.

40

15

33

18

23

9

0

5

10

15

20

25

30

35

40

45

Pay Cut Lost My Job Expenses Increases

Financial Situation Improved

Stopped Investing Withdraw their Investment

How your Income Impacted by covid 19

No of Respondents



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Taken out money during this pandemic wise analysis

Preferances No of respondents Percentage

Yes 59 60.2% No 39 39.8%

Inference

Above analysis shows that 60.2% respondent which is equal to 59 out of 98 taken out their money from market in the last few months of this covid 19 pandemic and 39.8% respondent didn’t take out their money from market.

40

26

16

16

How you use money in this pandemic?

For paying rent and utility bills To pay debts Putting in sefty net funds Put towards investment



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Reinvestment plan wise analysis

Preferances No of Respondents Percentage After getting financially secure again

23 34.8%

After market correction 10 15.2% Have no plans to reinvest 15 22.7% Unsure 18 27.3%

Inferance

Above analysis shows that 23 respondent have plan of reinvestment after getting financially secure again which is equal to 34.8% while 15.2% have plan of investment only after market gets corrected. 22.7% respondent have no any plan of reinvestment and 27,3% respondents are unsure about their future plan of investment.

59

39

Taken out money From Market

Yes No



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T Test

23

1015

18

Reinvestment Plan

After getting financially secure again After market correction Have no plans to reinvest Unsure



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The Relationship between income and investment

Hypothesis:-

Null Hypothesis H0:- There is relationship between income and investment.

Null Hypothesis H1:- There is no relationship between income and investment.

Group 1 (Income) Group 2 (Investment) Data 76,12,7,3,0 6,13,30,22,19 Mean 19.6 18.0 SEM 14.24 4.06 SD (n) 28.48 8.12 SD(n-1) 31.84 9.08 N 5 5 P value 0.9184 0.0322

Result :-

As the T Test value of investment is less than significant value (0.0322 < 0.05) and T Test value of income is greater than significant value (0.9184>0.05) , We accepet the null hypothesis H0 i.e. there is relationship between income and investment and reject the alternative hypothesis H1.

Signifanct level at 5%.

Therefore we conclude that there is relationship between income and investment.

Findings

1. Most of the respondent want to liquidate there cash amid this crisis.

2. There is relationship between Income and Investment.

3. Most of the respondent prefers monthly investment (33.3%) than daily, weekly, quarterly and yearly.

4. Mostly investors have not much aware about investment schemes that is more than 70%.

5. Most of the investors choose Saving Account and Bank FD’s as an investment option followed by Mutual Funds and Equity Shares than any other options.

6.Most of the investors things that Saving Account, Bank FD’s are not risky options for investment schemes followed by POSS and Pension Schemes than any other investment options.



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7.Most of the investors main objective of investing money is for completing their future wishes like buying car, buld an house etc followed by for education and vacation purpose also.

8.Investors investment depends upon their annual income.

9. 65.3% respondents Income impacted by covid 19.

10. 40.8% employee facing pay cut due to covid 19,15.3% lost their job due to this pandemic and 33.7 % respondent said that their expenses increases due to this covid 19 pandemic.

11. Many peoples taken out their money from market due to this covid 19 pandemic which is approximately equal to 60%.

12. 34.8% respondent have plan to reinvest their money after getting financially secure again and 22.7% have no plan of reinvestment.

Suggetions

1. Investors should make investment keeping their objectives of investment in mind . 2. Investors may contact investment related broker or agents but their decision should

depends upon their own investigations. 3. Investors should select investment option depends upon their need and future

planning with proper risk. 4. Investors should have to monitors their investment regularly. 5. Investors also can choose option of diversifying their investment to reducing risk. 6. Brokers,agents ,companies should have to provide proper information to the investors

regarding their investment.

Conclusion

This research confirms that there is relationship between income and investment.Investors wants maximum return with minimum risk.Individual investors prefers to invest in availoable option which is reskfree.Investors thinks that land and gold are two ideal options of investment.They gives good return and appreciation.Even high income background investors prefers safer investment.Investment platform companies or agents should have to come with safer platform with minimum risk for investment to attrack investors.



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Bibiliography

Research Paper Refered:-

1. Prof.SanketL.Charkha&Dr.Jagdeesh R. Lanjekar - A Study Of Saving And Investment Pattern of Salaried Class People with Special Reference To Pune City (India).

2. SonaliPatil, Dr.KalpanaNandawar ,2014 - A Study on Preferred Investment Avenues Among Salaried People With Reference To Pune, India.

3. V. Shanmugasundaram and V. Balakrishnan, 2011, Investment decision-making – A Behavioural Approach

4. Dr.A.P.Dash, Sr.Faculty, PMI, Basics Of investment 5. Dr. (Mrs.) SushantNagpal, 2007, Psychology of Investments and Investor’s

Preferences. 6. Ms.M.KothaiNayaki&Mrs.P.Prema, A Study on Indian Individual Investors’

Behavior. 7. Dr.S.SuriyaMurithi ,B.Narayanan&M.Arivazhagan,Investors behaviour in various

Investment Avenues – a study.

Websites:-

www.google.com

www.investopedia.com

www.investing.com

www.moneymanagementideas.com

www.savingwala.com

www.indiamoney.com



http://www.google.com/

http://www.investopedia.com/

http://www.investing.com/

http://www.moneymanagementideas.com/

http://www.savingwala.com/

Documents

INVESTORS BEHAVIOUR IN VARIOUS INVESTMENT AVENUES …...of investment avenues are available . In the above mentioned avenuesall the investors invest their surplus money based on their