Analysis of Retail Investors' Behavior in the Capital Market

Abstract

There are various types of investors in the capital market, but retail investors are a mentionable portion and they behave in the market in different ways. They are of different age, sex, education background and size of the family. They are different on the basis of income level also. Investors' behavior is influenced by demographic, financial and macro factors. This paper examines the various influencing factors of behavior and thereby finds some motivating factors for which investors behave aggressively, moderately and conservatively in the market. Due to imbalanced behavior by some investors, the market price fluctuates extremely. As a result new investors sometimes lose their capital and that is de-motivational for the new as well as potential investors. So the paper is an attempt to study the investors' behavior for finding relevantfactors to control the market behavior that will protect the investors' interest as well as to develop the efficient capital market.