2. “ YOU HAVE TO RISK GOING TOO FAR IN ORDER TO
DISCOVER JUST HOW FAR YOU
CAN REALLY GO. ”
- T.S. ELIOTT, 1888
RISK
3. RISK TAKING
This refers to the extent to which an individual
is prepared to take risks. People who are highly
risk-taking in their behavior make decisions
quickly without searching for much
information. Risk-averse people do not make
decisions in a hurry and gather a lot
of information before making any decision.
However, research has indicated that the
accuracy of decisions made by both risk-taking
and risk-averse people is almost the same.
In organizations, the suitability of a person's
risk-taking or risk-averse behavior depends on
the duties and responsibilities of his job.
For example, the job of a foreign currency
trader requires individuals with high risk-taking
propensity, whereas the job of a clerk or that of
a typist requires individuals with low risk-
taking propensity.
4. EMOTIONS
In psychology and philosophy, emotion is a subjective, conscious
experience characterized primarily by psychophysiological
expressions, biological reactions, and mental states.
Emotion is often associated and considered influential with mood,
temperament, personality, disposition, and motivation.
Emotion is often the driving force behind motivation, positive or
negative.
An alternative definition of emotion is a "positive or negative
experience that is associated with a particular pattern of
physiological activity.
5. OBJECTIVE & ABSTRACT:
Finding relationship between emotions of an individual
and their tendency to take risks.
This paper explores the relation between emotions and
risk taking.. It considers recent studies of risk attitudes
and behaviour among second year engineering students
against the background of conceptions of risk derived
from various theories.
6. SURVEY
We Conducted 2 Surveys , Emotions and Financial
Decision and Human Values and Financial Risk
Perception Scale to study Risk Taking and Emotions.
The survey was conducted with 2nd year B.E students of
all branches.
It had a total of 91 participants of which 63 were male
and 28 females.
7. EMOTIONS AND
FINANCIAL DECISION
It explains the investment outcomes at different time
period say at an interval of one year. Certain questions
have been framed based on the chart description and we
want to know your instant reaction to each of the
statement/outcome.
The survey is Summarised in the Figure
10. HUMAN VALUES AND FINANCIAL RISK
PERCEPTION SCALE
72.75
23.40
37.50
36.50
25.80
24.90
25.90
56.00
56.00
26.60
33.67
25.60
27.25
76.60
62.50
63.50
74.20
75.10
74.10
44.00
44.00
73.40
66.33
74.40
K B C V ACATION STOCK IN V EST RISK B ON D RETURN 5K 20K GOL D RISK IN VGOL D M IN E
HUMAN VALUES AND FINANCIAL RISK PERCEPTION SCALE
risk
Mean: Risk:38.09%
14. CONCLUSION
When a gain something he feels joy and elated, when he
experiences loss he feels disappointed and depressed.
It has been observed that 2nd year ,BE students ,tend to be
moderate risk takers and in almost 35% of cases followed
their emotions.
We conclude that students take risks and exhibit risk taking
behaviour but they are equally disappointed when their
desires are not fulfilled. Students are quite insensitive to
estimates of the probabilities of possible outcomes; their
decisions are particularly affected by the way their attention
is focused on critical performance targets; and they make a
sharp distinction between taking risks and gambling. These
differences, along with closely related observations drawn
from other studies of individual and organizational choice,
indicate that the behavioural phenomenon of risk taking in
organizational settings is dependent on emotions.
15. CONCLUSION
Risk-taking is a part of everyday life in some sense and requires some
degree of risk. In order to accomplish things that you aren't 100% sure
are going to work out the way you want, requires you to take a chance
that it is going to work.
It is when risk-taking takes a turn for the dangerous and unhealthy
that it can become a problem for individuals and the people they are
close to.
In order to manage risk-taking behaviours effectively it is necessary to
observe your own behaviour closely and try to pinpoint what it is that
makes you behave in risky ways.
Once you have identified these events or behaviours, make the
decision to change. Set goals and make an action plan with positive
reinforcers along the way.
If external help or motivation is needed get in contact with a help-line
or ask friends and family for assistance.
In psychological sense there are a few different measures in use for
assessment of an individuals risk propensity, most of which are useful
but none of which are agreed with complete consensus that it is
correctly measuring risk-taking.
Editor's Notes
This paper explores the relation between emotions and risk taking.. It considers recent studies of risk attitudes and behaviour among second year engineering students against the background of conceptions of risk derived from theories of choice. We conclude that students take risks and exhibit risk taking behaviour but they are equally disappointed when their desires are not fulfilled. Students are quite insensitive to estimates of the probabilities of possible outcomes; their decisions are particularly affected by the way their attention is focused on critical performance targets; and they make a sharp distinction between taking risks and gambling. These differences, along with closely related observations drawn from other studies of individual and organizational choice, indicate that the behavioural phenomenon of risk taking in organizational settings is dependent on emotions
It explains the investment outcomes at different time period say at an interval of one year. Certain questions have been framed based on the chart description and we want to know your instant reaction to each of the statement/outcome.
The survey is Summarised in the Figure
From our survey we found out that ,Students experienced joy and Happiness if they had a profit without taking much risk ,like when they property price increased and they were holding it 45% people were happy but if they sold 34% were disappointed.Also even if the student had sold the property when it lost value or there was no change in it’s value ,the level of happiness was lesser as compare to gain.Gaining made people happy.
In this survey we evaluated how much risk a person takes in various situations. We found out that in almost all the cases people were reluctant to take risks ,on an average 38% people were willing to takes risks other were more emotional while making there decisions.This histogram shows the level of risks students were willing to take in each question.
As can be clearly seen from the area diagram in almost all situations people didn’t want to take too much risks. They take risks only after thinking and gathering information which makes them risk averse.
Risk-taking is a part of everyday life in some sense and requires some degree of risk. In order to accomplish things that you aren't 100% sure are going to work out the way you want, requires you to take a chance that it is going to work. It is when risk-taking takes a turn for the dangerous and unhealthy that it can become a problem for individuals and the people they are close to. In order to manage risk-taking behaviours effectively it is necessary to observe your own behaviour closely and try to pinpoint what it is that makes you behave in risky ways. Once you have identified these events or behaviours, make the decision to change. Set goals and make an action plan with positive reinforcers along the way. If external help or motivation is needed get in contact with a help-line or ask friends and family for assistance. In psychological sense there are a few different measures in use for assessment of an individuals risk propensity, most of which are useful but none of which are agreed with complete consensus that it is correctly measuring risk-taking. The consequences of risk-taking can be devastating and long-term and the time should be taken to learn how to manage your own or to help someone else realise and moderate risk-taking behaviours.