This document analyzes individual investors' behavior towards investing in the Indian stock market. It conducted a survey of 50 individual investors who primarily invest in equities and equity-related instruments. The study found that most individual investors are male, between 30-40 years old, have a business or self-employed occupation, have a graduate or post-graduate education, and have been investing in the stock market for 3-5 years. The study also examined correlations between various demographic factors and investment preferences, finding that family trends positively influence individual investment decisions and preferred trading methods depend on occupation.

1. International Journal of Advanced Research in Management (IJARM), ISSN 0976 – 6324 (Print),
ISSN 0976 – 6332 (Online), Volume 5, Issue 5, September-October (2014), pp. 10-18 © IAEME
10
AN ANALYSIS OF INDIVIDUAL INVESTORS TOWARDS
INVESTING IN STOCK MARKET
GAURAV GUPTA
Asst. Professor, Indus Business Academy, Plot No. 44, Knowledge Park III, Greater Noida &
Research Scholar, University of Petroleum and Energy Studies - Dehradun
Mrs. GEETA GUPTA
(Research Scholar, Shri Venkateshwara University, Gajraula)
ABSTRACT
The Indian securities market has become one of the most dynamic and efficient
securities market in Asia today. The Indian market now conforms to international standard in
terms of operating efficiency. Stock Market plays the role of Barometer, namely an indicator
of the state of health of the nation’s economy as whole. This market is consisting of
securities, participants, regulation and trading arrangement. The major participants are the
buyers and the sellers of the securities or the investors Investors may be Individual or
Institutional. Individual investors operate alongside institutional investors in the investment
arena. Institutional investors are the organizations with surplus funds that engage in
Investment activities like Mutual funds, bank, insurance companies etc.On the other hand
individual investors are large in number but their investment resources are comparatively
smaller. They generally lack the skills to carry out extensive evaluation and analysis before
investing. Moreover they do not have the time and resources to engage in such analysis. So
this study aims to analyze their behavior towards investing in stock market.
Keywords: Equity, Trend.
RESEARCH METHODOLOGY
The research has been conducted on primary data through questionnaire filled by the
general public who invest mostly in equity and equity related instruments. Techniques have
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2. International Journal of Advanced Research in Management (IJARM), ISSN 0976 – 6324 (Print),
ISSN 0976 – 6332 (Online), Volume 5, Issue 5, September-October (2014), pp. 10-18 © IAEME
11
been used to find the results from the primary data are as follows: A sample of 50 Investors
have been taken.
• Analysis of each question.
• Demographic analysis.
• Hypothesis
• Correlation.
Demographic analysis of questionnaire
I. Gender of the person
II. Age of the person
III. Occupation of the person
IV. Qualification of the persons
1.1 Gender of the person
gender of the person
Frequency Percent Valid Percent
Cumulative
Percent
Valid Male 39 78.0 78.0 78.0
Female 11 22.0 22.0 100.0
Total 50 100.0 100.0
Table 4.1
Interpretation: Out of the 50 surveyed people, 39 are male and the rest 11 are the female
candidates.
1.2 Age of the person
Frequency Percent Valid Percent
Cumulative
Percent
Valid 20-30 13 26.0 26.0 26.0
30-40 22 44.0 44.0 70.0
40-50 9 18.0 18.0 88.0
50 & above 6 12.0 12.0 100.0
Total 50 100.0 100.0
Interpretation: Out of 50 surveyed person 13 are age group of 20-30, 22 are of age group 30-
40, 9 are of 40-50 and the rest 6 are of 50 & above age

3. International Journal of Advanced Research in Management (IJARM), ISSN 0976 – 6324 (Print),
ISSN 0976 – 6332 (Online), Volume 5, Issue 5, September-October (2014), pp. 10-18 © IAEME
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1.3 Occupation of the persons
occupation of the person
Frequency Percent Valid Percent
Cumulative
Percent
Valid Business 20 40.0 40.0 40.0
Salaried 14 28.0 28.0 68.0
Self employed 16 32.0 32.0 100.0
Total 50 100.0 100.0
Interpretation: The above data represent that out of 50 surveyed person, 39 who invest in
equity are mostly belong to business class as shown above 20 out of 50 are business class, 14
salaried and the rest 16 are self employed.
1.4 Qualification of the person
qualification of the person
Frequency Percent Valid Percent
Cumulative
Percent
Valid Graduate 25 50.0 50.0 50.0
Post-graduate 25 50.0 50.0 100.0
Total 50 100.0 100.0
Interpretation: The above table shows that all the investors who invest in equity are either
graduate or post graduate.
DATA ANALYSIS
HYPOTHESIS
1) Hypothesis betweens
a) Investing money range for stocks
b) Time period of investment
H0 (Null Hypothesis): Investing money range for stocks is independent of time period of
investment.
H1 (Alternative Hypothesis): Investing money range for stock is dependent of time period of
investment.

4. International Journal of Advanced Research in Management (IJARM), ISSN 0976 – 6324 (Print),
ISSN 0976 – 6332 (Online), Volume 5, Issue 5, September-October (2014), pp. 10-18 © IAEME
13
Chi-Square Tests
Interpretation: In the above presented Chi- square test, Test Value is come out to be 13.677,
Likelihood Ratio is 16.288, and Pearson (P) value/ critical value is 0.134 and the Level of
significance is 0.05.
Now according to the rule:
1) Null Hypothesis is accepted in two cases;
(a) Test value < Likelihood Ratio
(b) Pearson value > Significance level
2) Null Hypothesis is rejected in two cases:
(a) Test value > Likelihood Ratio
(b) Pearson value < Significance level
Now as per the rule, in the above mention Hypothesis, Test value < Likelihood ratio
as well as Pearson value > Significance level, therefore Null hypothesis is accepted . This
shows that investing money range for stocks is independent of Time period of investment of
the person.
2) Hypothesis Between
a) Time period of investment
b) Age of the person
H0 (Null Hypothesis): Time period of investment is independent of Age of the person.
H1 (Alternative Hypothesis): Time period of investment is dependent of Age of the person.
Value df
Asymp. Sig.
(2-sided)
Monte Carlo Sig. (2-sided)
Sig.
95% Confidence Interval
Lower Bound Upper Bound
Pearson Chi-
Square
13.677
a 9 .134 .160b
.058 .262
Likelihood Ratio 16.288 9 .061 .180b
.074 .286
N of Valid Cases 32

5. International Journal of Advanced Research in Management (IJARM), ISSN 0976 – 6324 (Print),
ISSN 0976 – 6332 (Online), Volume 5, Issue 5, September-October (2014), pp. 10-18 © IAEME
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Chi-Square Tests
Interpretation: In the above Chi square test, Test value come out to be 5.676, likelihood
Ratio is 7.796 and Pearson value which is also known as critical value is .772 when level of
significance is 0.05.
Now according to the rule:
1) Null Hypothesis is accepted in two cases;
(a) Test value < Likelihood Ratio
(b) Pearson value > Significance level
2) Null Hypothesis is rejected in two cases:
(a) Test value > Likelihood Ratio
(b) Pearson value < Significance level
Now as per the rule, in above mention Hypothesis Test value < Likelihood Ratio as
well as Pearson value > Significance level, therefore Null hypothesis is accepted. It means
that Time period of investment don’t depend on Age of the person. This signifies that Time
period of investment of investor is depend on various other factor rather than Age of the
person.
Correlations:
1) Correlation between
a) Investment in equity and equity related instruments
b) Family trend to invest in equity and equity related instruments
Value df
Asymp. Sig.
(2-sided)
Monte Carlo Sig. (2-sided)
Sig.
95% Confidence Interval
Lower Bound Upper Bound
Pearson Chi-Square 5.676a
9 .772 .820b
.714 .926
Likelihood Ratio 7.796 9 .555 .780b
.665 .895
N of Valid Cases 39

6. International Journal of Advanced Research in Management (IJARM), ISSN 0976 – 6324 (Print),
ISSN 0976 – 6332 (Online), Volume 5, Issue 5, September-October (2014), pp. 10-18 © IAEME
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Correlations
investment in
equity and equity
related instruments
family trend to invest
in equity and equity
related instrument
investment in equity and
equity related instruments
Pearson Correlation
1 .575**
Sig. (2-tailed) .000
N 50 50
family trend to invest in
equity and equity related
instrument
Pearson Correlation
.575**
1
Sig. (2-tailed) .000
N 50 50
Interpretation: The above table shows that correlation between investment in equity and
equity related instruments and family trend to invest in equity and equity related instruments
is 0.575 which lies between 0.50 to 0.75 which clearly signifies that correlation between
above parameter is highly positively correlated. This clearly represents that Investment in
equity and equity related instruments depends positively on family trend to invest in equity.
2) Correlation between
a) Occupation of the person
b) Preferred trading method
Correlations
occupation of the
person
preferred trading
method
occupation of the person Pearson Correlation
1 .347*
Sig. (2-tailed) .030
N 50 39
preferred trading method Pearson Correlation
.347*
1
Sig. (2-tailed) .030
N 39 39
Interpretation: The above table shows that correlation between occupation of the person and
preferred trading method is 0.347 which lies between 0.50 to 0.75 which represent that
correlation between above parameters is positively correlated. This symbolize that preferred
trading method is positively depend on occupation of the person.

7. International Journal of Advanced Research in Management (IJARM), ISSN 0976 – 6324 (Print),
ISSN 0976 – 6332 (Online), Volume 5, Issue 5, September-October (2014), pp. 10-18 © IAEME
16
CONCLUSION
This paper studies those general factors which investors consider during taking
investment decision. Most of the surveyed person prefers to invest in equity and equity
related instruments and due to high industrialization growth and high return on investment
most of the surveyed people have been investing in stock market from a long time i.e. 3- 5
years. But still people feel stock market very risky and only very few people invest more than
40% of their income in stock market. Because of risk factor associated in stock market the
majority of people prefer to invest in fixed deposits. A large group of investors invest by their
own in the stock market and this is not a good way to invest they should take proper advice
from the expert or they should get some training. The people who prefer advice from other
sources, majority of them find it more beneficial to take advice from financial planner and
this is a good sign. Family trend to invest in equity market play a significant role. Investment
in equity and equity related instruments depends positively on family trend to invest in
equity.
And as far as broking firm selection, method of trading is concern and best broking
firm is concerned, investor gives preference to service quality and brokerage charges this
show that individual investor want good service quality during investing and less broking
charge. Due to time saving and security feature of online, most of the surveyed persons prefer
online method. And among the broking firms Share khan is the most preferred firm for
investment by most of the investor.
While we tried to find out the relationship between Investing money range and Time
period of investment, investing money range for stocks is independent of Time period of
investment of the person. Similarly Time period of investment don’t depend on Age of the
person
QUESTIONNAIRE
Dear Sir/Madam
We are conducting a survey on ‘An analysis of Individual investor towards investing in
stock market’ we need your help in conducting this study. For this we have designed a
questionnaire to know your views. Kindly provide your valuable opinion to fill this
questionnaire. Information provided by you will be kept strictly confidential & will be
exclusively used for academic purpose.
PERSONAL INFORMATION (Optional)
NAME: ______________ Age: 20- 30 30-40 40-50 50 & above
GENDER: a) Male b) Female
LOCATION:_______________
OCCUPATION: Business Salaried Self Employed
QUALIFICATION: Graduate Post-Graduate

8. International Journal of Advanced Research in Management (IJARM), ISSN 0976 – 6324 (Print),
ISSN 0976 – 6332 (Online), Volume 5, Issue 5, September-October (2014), pp. 10-18 © IAEME
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Q1. Do you invest in equity and equity related instruments?
a) Yes b) No
Q2. Is there a trend in your family to invest in equity and equity related instruments?
a) Yes b) No
Q3. In which sectors other than equity you invest?
a. Mutual fund b-Commodity c. Fixed Deposits
d. Gold/Silver e. Real Estate f. Post office
Q4. How long have you been to invest in the stock market?
a) Less than 1 year c) 1-3 year
b) 3-5 year d) More than 5 year
Q5. What is your investing money range for stock?
a) Rs.0-50000 c) Rs.50001-100000
b) Rs.100001-500000 d) Rs500001 and above
Q6. What percentage of your income you invest in equity and equity related
instruments?
a) 10 %-20 % c) 31% -40%
b) 21%- 30 % d) 41% and above
Q7. Which firm do you prefer for investment?
a) Share khan c) India info line
b) India bulls securities d) ICICI direct
Q8. Do you invest all by yourself or get advice by professional advisor?
a) Own b) Others advice
If others advice then which one
a) Television b) radio
c) Magazine/News Paper d)Financial planner
Q9. Which of the trading methods you prefer?
a) Online b) Offline

9. International Journal of Advanced Research in Management (IJARM), ISSN 0976 – 6324 (Print),
ISSN 0976 – 6332 (Online), Volume 5, Issue 5, September-October (2014), pp. 10-18 © IAEME
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Q10. Which features do you prefer for selecting the broking firm?
a) Past record of company d) Brokerage
b) Goodwill of company e) Service quality
c) Proximity from Location
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