This document provides an introduction and background to a research study evaluating decision making processes for new investments in stock exchanges. The study aims to examine factors influencing effective investment decisions and compare theoretical decision making concepts to real-world investment practices. Primary research will be conducted through questionnaires with investors and managers at Barclays Capital in London. The research aims to help young investors understand how to make profitable investment decisions and help financial professionals better assess investor risk attitudes. It also seeks to identify barriers investors face in accessing financing beyond business characteristics. The introduction provides context on investment trends and historical events affecting stock markets.

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Evaluation of Decision Making Process of new
Investment in Stock Exchange for Effective
Investment
A case of Barclays Capital in London
Supervisor:
Dr. Tahir Javed
Master of Business and Administration
Dissertation
By
Student:
Milos Stanojevic
Student ID: 139150221
Module Code
PGBM73
Academic Year 2015
University of Sunderland London Campus

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Abstract
The stock market is growing constantly, and decision making process for effective investment
becomes major question in recent years. The interest in understanding a decision-making process for
effective investment and also understanding investors and managers attitudes toward decision
making process become stronger than ever before. The purpose of this research is to increase
understanding of decision-making process in investment environment as well as factors influencing
value creation of decision-making process for effective investment on stock exchange. It compares
the theoretical concept of decision-making process with the reality of the investment world.
Data employed were collected from two sources, primary and secondary research methods. For
primary data were obtained qualitative questionnaires administrated to investors and managers in
investment company’s different categorised as experienced and professionals. Secondary data were
collected from various sources such as business library, journal articles, eBooks, catalogues,
textbooks and internet.
The result of the research shows that mangers and investors perception of decision-making process
slightly diverges from what is stated in decision-making theory for effective investment. However
managers in investment companies and individual investors don’t differ much in their view of
decision-making process. It was also important to show through this research investor’s attitude
towards factors influencing decision making process which showed us different opinions regarding
diversified stock market events.

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APPENDIX 7 - DISSERTATION (PGBM73) DECLARATION
Statement of Originality and Authenticity
I confirm that the dissertation I am submitting is an original and authentic piece of work
written by myself that satisfies the University rules and regulations with respect to Plagiarism
and Collusion. I further confirm that I have fully referenced and acknowledged all material
incorporated as secondary resources in accordance with the Harvard system.
I also certify that I have taken a copy of the dissertation, which I will retain until after the
Board of Examiners has published the results, and which I will make available on request in
pursuance of any appropriate aspect of the marking and moderation of the work within the
University Regulations.
Name: Milos Stanojevic
Registration Number: 139150221
Programme: MBA
Study Centre: University of Sunderland London Campus
Date: 10.06.2015
Signed: Milos Stanojevic
Please note that Dissertations will not be assessed without the inclusion of this
declaration by the student
Please note that Dissertations may not be assessed without the inclusion of electronic
copies which may be submitted through the ‘turnitin’ software to check for authenticity.
Supervisor’s signature:……………………………….
Date: ……………………………….

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Acknowledgment
This thesis is the outcome of my MBA project research carried out in University of Sunderland
(London Campus) over the course period January 2015-June 2015. In these preliminary lines, I
would like to express my great gratitude to those who have contributed to the theses for their
understanding, encouragement, and support, because this work would not have been possible without
all their valuable day-to-day effort, commitment and dedication.
First of all, my special words of appreciation and deepest recognition go to my thesis
mentor/supervisor, Professor Tahir Javed. I am sincerely grateful to Tahir for his support and effort
spent on my research during the past months. I benefited enormously from his invaluable expertise,
insightful comments, and excellent supervision. In addition, he has constantly providing me
numerous valuable comments and suggestions that made me confident to finish this research.
I would also like to express my gratitude to administrative support and student advices from
employees in University of Sunderland.
A global thank you to individuals who participated in the research surveys giving their time and
expertise. The contributions that were made proved to be very valuable in conducting this research
study.
And, special thank you to Miroslav and Sonja Koncar for giving me comments on the design and
final overview of the questionnaire employed and instant encouraging to improve the quality of the
theses.
Finally, it would be impossible to say enough about my dear parents, family and beloved friends,
always trying to support and giving important advices to overcome the most difficult time in order to
succeed to complete it on the time.

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TABLE OF CONTENTS
ACKNOWLEDGMENT
ABSTRACT
CHAPTER 1
INTRODUCTION AND BACKGROUND
1.0. INTRODUCTION OF RESEARCH
1.1. RESEARCH BACKGROUND
1.2. COMPANY BACKGROUND (BARCLAYS CAPITAL)
1.3. RESEARCH AIM
1.3.1. RESEARCH OBJECTIVES
1.3.2. RESEARCH QUESTIONS
1.4. IMPORTANCE AND SIGNIFICANCE OF RESEARCH
1.5. SCOPE AND LIMITATION
1.6. DISPOSITION
CHAPTER 2
LITERATURE REVIEW
2.1. KEY TERM OF THE LITERATURE
SECTION 1:
2.2. MEANINGS OF DECISION
2.3. IMPACT INVESTMENT
2.4. STOCK MARKET AND INVESTMENT DECISION
2.5. DECISION MAKING PROCESS
2.6. STRATEGIC DECISION MAKING PROCESS
2.7. ETHICAL DECISION MAKING
SECTION 2:
2.8. FACTORS THAT CAN AFFECT EFFECTIVE INVESTMENT DECISIONS
2.8.1. POLICY UNCERTAINTY AND INVESTMENT
2.8.2. SOURCES OF POLICY UNCERTAINTY
2.8.3. TAX POLICY AND INVESTMENT BEHAVIOUR
2.9. FISCAL POLICY, PROFITS, AND INVESTMENT

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2.10. POLITICAL INSTABILITY AND INVESTMENT
2.11. STOCK MARKET EVENTS
2.12. STOCK PRICES AND INVESTMENT
2.13. STRATEGIC AS STRATEGIC DECISION MAKING PROCESS (MEASUREMENT)
SECTION 3:
CONCLUSIONOF CHAPTER 2
CHAPTER 3
METHODOLOGY
3.0. INTRODUCTION TO RESEARCH METHODOLOGY
3.1. MEANING OF RESEARCH
3.2. TYPES OF RESEARCH
3.2.1 RESEARCH ONION MODEL
3.3. RESEARCH PHILOSOPHIES
3.3.1. ONTOLOGY AND EPISTEMOLOGY
3.3.2. POSITIVISM
3.3.3. PHENOMENOLOGY
3.4. RESEARCH APPROACH
3.5. SAMPLING TECHNIQUES
3.6. TRIANGULATION
3.7. TYPES OF DATA COLLECTING
3.7.1 SECONDARY
3.7.2. PRIMARY
3.7.3 OBSERVATIONS INTERVIEW QUESTIONNAIRE
3.8. METHODS OF DATA COLLECTING
3.8.1. QUALITATIVE RESEARCH METHODS
3.8.2. QUANTITATIVE RESEARCH METHODS
3.9. ETHICS OF RESEARCH
CHAPTER 4
DATA ANALYSES AND PRESENTATION
4.0. INTRODUCTION OF DATA ANALYSES AND PRESENTATION

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INTERVIEW
CHAPTER 5
CONCLUSION AND RECOMMENDATIONS
5.0. INTRODUCTION
5.1. CONCLUSION / SUMMARY
RECOMMENDATIONS
5.2. FUTURE RESEARCH
CHAPTER 6
PERSONAL DEVELOPMENT PLAN
6.0. INTRODUCTION
6.1. LEARNING FROM MASTER OF BUSINESS ADMINISTRATION
REFERENCIES
APPENDIX 1
PERMISSION LETTER FOR DATA COLLECTION
APPENDIX 2
QUALITATIVE QUESTIONNAIRE
INTERVIEW

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CHAPTER 1
Introduction and Background
1.0. Introduction of Research
Every young person involved in trading and investment in stock exchange would like to
know how to gain success in that venture. It is a greatest challenge for them to know how to
make a good decision for effective investment in buying and selling shares in stock exchange.
It appears that the decision making usually depends on some factors such as: investor’s age,
education, income, investment portfolio and other factors such as experience too.
This research is directly associated with these factors which each investor needs to take into
consideration when making a decision for new investments in stock exchange. The main
highlights of this research are to explore the Evaluation of Decision Making Process of new
Investment in Stock Exchange for Effective Investment.
It is known that psychology of the investors and its associated factors can have an impact on
their decision making process and through this research the main focus for researcher is to
examine the relationship between investor’s attitude towards risk and decision-making in
order to define the best possible way for the young investors and traders how to make an
effective investment decisions.
This research will also be useful for investment advisors and finance professionals to judge
investor’s attitude towards risk in better way which can lead to more profane investments and
even more effective decision-making.
The case of Barclays Capital (see fig 1.2) will be analysed through this study in order to give
a good understandings of decision making process for new investment as Barclays is
regularly involved in such sort of decision.
1.1. Research Background
Gaining the positive decision making attitude is a key instrument in every developed
economy which can lead investors into the greatest success so they can have even better
judgement for the future investments. Understanding the way that investments are working in
stock market exchange can help investors to make the right decision for effective investment.

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Prior to the “credit crunch” it was often commented that substantial private investment was
available for the new ventures (Daily Telegraph, 2006). However, whilst there may have been
large amounts of funds looking for a new investment opportunity, such financiers were
seeking opportunities with proprietary intellectual capital, exceptional management; a market
that is not what equity investors quaintly call “pre-revenue” and the chance of a high return
(Irwin & Scott, 2010). Many groups of owner-managers, for a variety of reasons, were
finding difficult to raise the capital they needed. This research project will also investigate
whether investors’ personal characteristics introduce additional barriers which can have an
impact on their ability to access to the finance other than those that affect businesses of their
sector, size and other characteristics (Irwin & Scott, 2010).
Further, because of market uncertainty it is difficult to understand and analyse the
relationship between real investors and markets. In the context of historical ground of the
stock market it is likely to assume that there were many events which directly refers to a
dramatic change in a stock exchange prices and their fluctuations such as: the Great Crush in
1929, The Tonic’s Boom of the early 1960s, The Go-Go Years of the late 1960s, The Nifty
Fifty bubble of the early 1970s, and the Black Monday crash of October 1987, Mortgage
Crash in 2008 (Baker & Wurgler, 2006).
According to Lamminpää, V., & Karlsson, L. (2005) it is assumed, through the classical
economic theory, that investment decisions are made using all available information in an
efficient manner. Decision theory is normative, meaning that it is concerned with identifying
the ideal decision. Evidence suggests that decision making process is among the most
important factor for investors and also it is an important component according to micro and
macro economy (Lamminpää, V., & Karlsson, L. 2005).
Modern financial theory is based on the premise that individuals are rational in their approach
to their investment decision. Financial experts are taught that investors make investment
choices on the basis of all available information. For instance, an individual utilizes a specific
investment tool such as stock valuation that is applied in a rational and systematic manner.
Objective of this approach for investors is achievement of increased financial wealth.
Advocates of the efficient market theory argue that it is futile to practice or to apply certain
investment techniques or styles since an investor’s expertise and prospects are already
reflected either in a specific stock prices or the overall financial market (Ricciardi, V. 2008).

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According to recent events and research conducted by Zhang, C. (2008), whose findings
increasingly suggested investor sentiment has been traditionally regarded as a myth by
classical financial theories and have received little attention by researchers by 1990.
Nowadays, there seem to be good theoretical as well as empirical reasons to believe that
investor sentiment affects stock prices. To affect prices, these less-than-rational beliefs have
to be correlated across noise traders, otherwise traders based on wrong judgments would
cancel out of investment. When investor sentiment affects the demand of enough
investments, security prices diverge from fundamental values. However, this wouldn’t be
important if the stock market did not affect real economic activity. If the stock market were
sideshow, market inefficiencies would merely redistribute wealth between smart investors
and traders. In the context of financial markets, this can be thought as a stock price that is
objectively correct, but which individual investors only possess subjective beliefs (Zhang, C.
2008).
A case of Barclays Capital will be analysed thought this study in order to give good
understandings of decision making process for new investment. As a world leading
investment bank, BC provides its clients with a large corporate, government, and institutional
clients with full range of strategic advisory, financing and risk management needs. It is
necessary for this research to challenge performances and to critically analyse returns of the
investment managers according to market condition (@Barclays 2015).
1.2. Company Background (Barclays Capital)
Barclay’s investment Bank is the investment banking division in the British multinational
bank headquartered in London. Focus of this department is to provide financing and risk
management to their clients, companies and institutions. Company operates in 29 countries
with over 20000 employees. Barclays also provides foreign exchange, security lending, and
the loan syndication services. Investment platform in Barclays Capital was introduced in
1997 and immediately that operation began in its offices worldwide: Chicago, Illinois;
Boston, Massachusetts; Whippany, New Jersey; Johannesburg, South Africa; and Paris,
France. Barclays Capital PLC operates as a subsidiary of Barclays Bank PLC (Bloomberg,
2015).
Nowadays investment banking is complex set of activities, including underwriting and
advisory services, brokerage and trading, and asset management. By Underwriting and
advisory services investment bank helps companies to rise funds by issuing securities in the

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financial markets. On the other hand, brokerage and trading is useful instrument of banks that
provides issued securities to third part investors. With careful managing their assets, investors
and brokers are together investing in certain company or in stock market where this company
is listed (Iannotta G., 2010).
This kind of industry evolved significantly in mid-1990 to 2008, when banks had balanced a
mix of three major product and services lines of full-service investment banks: trading, asset
management, and investment banking. As we said before, nowadays, trading overtakes other
product lines and becoming a primary business activity in investment banking industry.
The activity of investment banking, such as investment, can be very risky, but this risk is
usually proportionally equal with return. In past decade, bigger part in revenue are brought by
trading department of investment divisions, and its activities are only possible with large
support from the firm’s capital which, therefore, puts that capital at risk. Proprietary trading
and principal investment are the primary activities that directly led to the distress of major
stock exchange firms (Rhee, R. J., 2010).
It is proved the decision making process is a key factor to gain opportunity of new
investment. In study conducted by R.E. Bellman and L.A. Zadeh Feb (1970), it is been
reported that the most of the decisions have been made without proper understanding of
business environment and the relevant market in which constrains and consequences are not
known precisely are directly affected by consequences of wrong decisions. This is also called
fuzzy environment (R.E. Bellman and L.A. Zadeh Feb 1970).
1.3. Research Aim
The main aim of this research is to make Evaluation of Decision Making Process of new
investment in stock exchange for effective investment. The case for primary research will be
Barclays Capital in London.
1.3.1. Research Objectives
Objectives:
1) To critically analyse decision making process in order to bring new investment opportunity
in investing in stock exchange.
2) To identify and evaluate factors those are affecting decision making process in effective
investment in stock exchange.

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3) To measure decision making strategy for new investors in effective investment in stock
exchange.
4) To recommend a better decision making strategy for new investors in effective investment
in stock exchange assessed to-date by:
1.3.2. Research Questions
1. Why decision making process is important in order to bring new investment opportunity
in investing in stock market?
2. What are the factors that can affect decision making process for effective investment in
stock markets?
3. What is the effective decision making strategy in order to make effective investment
decision in stock exchange?
1.4. Importance and Significance of Research
This research has great importance such as this research will able to identify fact for
effective investment opportunity, for new investors in stock exchange and provide valuable
knowledge to different finance managers levels who are engage with investment decision.
This research will provide their conceptual framework.
Further this research will able to provide guideline to young investors who will fill up their
knowledge regarding their current needs once this research is completed.
Desirability of this research is to be driven exactly comparatively according to investors
needs with the intention to gain quality information towards building up further
recommendations. Pride of this research is to meet those needs of investors establishing facts
earned through investigation accomplishing high level of significance.
1.5. Scope and Limitation
Scope:
The main scope of this research according to the nature of knowledge that once this research
is completed the outcome of this research in form of recommendation can be applied and
used to improve the decision making process for new investment of Barclays capital.

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Further this research will also provide valuable uses for Barclays to rectify existing system in
this regard. It is proven fact that this research also provide benefits to other companies who
are operating in the same trade.
Limitations:
There are many limitations that can affect any research i.e. Time money, topic, target
population, data collection locations, and primary data collection’s themes (Saunders et al.,
2011).
Therefore in this research the limitations can be as following:
Availability to do this research effectively is majority limited with available funds for
research. On the other hand, chosen topic and company for this research gives us exact levels
of approachability to primary data. In order to provide sophisticated information for this topic
focus is strict on population who is directly involved in decision making process for effective
investment in stock exchange. This population have been selected in more than one company
in order to compare results and provide information with respect to advanced knowledge
which will be helpful for new investors.
1.6. Disposition
Chapter 1: Research is composed of 5 chapters, beginning with introduction to the
phenomenon of decision making process for effective investment and problems related to
academic knowledge on the subject matter in chapter one.
Chapter 2: The second chapter presents literature review of previous academic research
based on decision making process and factors that can affect effective investment decision
and concluding by highlighting current problems in investment environment, which has been
pointed out by several researchers.
Chapter 3: Following the problem statement, chapter tree introduces methodological
consideration, which resulted in the choice of qualitative approach in the form of semi
structured interview, researcher observation, face to face interview. Additionally, chapter
accounts the selection of theory, data collection, data analyses and validity.
Chapter 4: Chapter four presents results of research and presents findings from primary and
secondary data collection. Further this chapter presents comprehensive overview of research

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on decision making process and factors that affects investment decisions and presents
comprehensive insights regarding aim and objectives of research.
Chapter 5: This chapter structure follows different stages concluding our research process.
Subsequently, according to findings and results presented, the final remark is assigned to
recommendations for future are of research aiming to give valuable recommendations to
newly investors.

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CHAPTER 2
Literature Review
2.1. Key Term of the Literature
Every academic project has to contain literature review as a support and guidance in order to
pursue good quality results of the project. A literature review is a conceptual frame work in
form of models, challenges, theories approaches, factors affecting etc. This chapter helps the
researcher to find the secondary solution to the problems as identified in chapter 1 (Rowley &
Slack, 2004).
The literature review means: Literature review is the process of reading, analysing,
evaluating, and summarizing scholarly materials about specific topic. A literature review is
summary of a subject field that supports the identification of specific research question.
Major needs of literature review is to draw on and evaluate a range of different types of
sources including academic and journal articles, books, and web-based resources (Rowley &
Slack, 2004).
According to this, every literature review may be completed in report or they may serve as a
part of research article, theses, or grant proposal. Literature research in this project is crated
in order to state a report of information found in literature related to topic of research:
“Evaluation of Decision Making Process of new Investment in Stock Exchange for Effective
Investment”. This research will describe, summarise, evaluate and clarify related literature for
this topic. Therefore this chapter is based on collecting secondary data in association of
research objectives. Further this chapter has 3 sections as following:
THEORETICAL GROUND
PRACTICAL SECTION
CONCLUSIONS

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Figure: 2.1.
Chart Design: Researcher (Milos Stanojevic, 2015)
All works included in the review must be read, evaluated and analysed. Development of any
academic project majority depends on relevant literature review that leads researcher to create
foundation for advancing knowledge. It facilitates theory development, closes areas where a
plethora of research, and uncovers areas where research is needed (Webster & Watson,
2002).
Further, creating a literature review involves many different stages: scanning, making notes,
structuring the literature review, writing of literature review, and building a bibliography.
Specifically this way of building up literature review is also called conceptual framework.
This concept is very helpful tool in developing an understanding of a subject area in order to
cover subject area with qualitative literature review, for this project literature search engines
have been used to identify and locate relevant documents and other sources, as well as web
sources and bibliographic database (Rowley & Slack, 2004).
Identifying and locating a relevant literature for this project in collaboration with conceptual
framework created two directions which this research will follow:
Firstly, it is going to be based on secondary data relating to investment, finance, and
economics available on internet, and previous publications, as well as, finance publication
and official statement from Barclays Capital. The information will be integrated in order to
understand relationship of investors at Barclays and their risk management, behaviour trough
decision making process, external factors and etc.
THEORETICAL GROUND
THEORETICAL GROUND
inform of different
Authorsopinionin
relationtoresearch
problemsforsolutionI.E
PRACTICAL SECTION
PRACTICALSECTION that
providesinformation
earnedfromexperience
of people involvedin
businessareachosenfor
thistopicand experience
relatedtoresearch
question.
CONCLUSIONS
CONCLUSIONS
summarise theoretical
and practical knowledge
and givesdirection
researchera directionto
achieve projectaim
regardingresearch
objectives.

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Knowing, on the other hand, that investment advisors and finance professionals from such a
company as Barclays is, must deal with behavioural issues as a risk factors in order to
formulate effective investment strategies for individual investors, therefore collection of
primary data from those professionals will be assumed and from huge importance for this
research.
Objectives that are crated for this research have been focused to identify investor’s
confidence for effective investment in Stock Market through decision-making process.
Trough research we will be tackle behavioural issues as risk factors while making investment
decisions in order to formulate effective investment strategies for individual young investors.
SECTION 1:
2.2. Meanings of Decision
Primary purpose of this research was to introduce the new way of making decisions in a
complex environment, such as investment departments, for making effective decision in
investing in a stock market. The representation of decision depends on people involved in this
process (Saaty, T. L. 2008).
Decision making process is a natural process that must be treated as a scientific activity to
meet nature’s and people’s requirement. As known that are many factors affecting decision
making process, as a start point it is crucial to identify important once for this field that this
research is focused on regarding its way to achieve research objectives. . Evaluating decision
making process for effective investment opportunity to invest in a stock market discovered
that successful decision must survive the difficulties and hazards of the environment (Saaty,
T. L. 2008).
Regarding this and further literature selected for this research have given a figures to
researcher that basic point for bringing good decision depends on quality of information
involved in a process and having a clearly defined goals. In that case, leaders who supposed
to deal with it have a stated up a direction where to head for including awareness of external
factors that become common concern in every decision making processes.
As a business environment changes trough the time seems that managers and leaders also
have to adapt to new circumstances and put the decision making process on advanced level.
In order to satisfy company needs, managers are more likely to breakdown decision making

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process into three different types to keep the brand’s highly profile position. Each major
strategic decision leads to tactical decision, which breaks down to operation decision:
 Strategic decisions are big choices of identity and direction. Mostly they are complex
and multi-dimensional. They have long term impact and are usually taken by senior
management.
 Tactical decisions are about managing performance to achieve the strategy. They
may involve significant resources, have medium-term implications and may be taken
by senior or meddle managers.
 Operational decisions are more routine and follow known rules. Characteristic for
them is involvement of limited resources, short-term application, and can be taken by
middle or first line managers.
2.3. Impact Investment
Impact investment is defined as “actively placing capital in business and funds that
generate social and environmental goods and a range of returns, from principal to
above market, to the investor”. Investors in impact investment funds include high-net-
worth individuals, institutional investors, corporations or foundations, who invest in a wide
range of asset classes (David Blood and Judith Rodin, 2010).
It is evident that now this research has to describe why impact investment exists and what its
actual function is. Particularly, very often government and charities does not have sufficient
capital and skills to solve the world’s challenges. Also recent economic crises made big
impact establishing increasing in the risk and return profiles of traditional investment.
Therefore, the impact investment is emerging as a partial answer to the current challenges.
Impact investment unlocks substantial capital to a build a more sustainable and equitable
global economy while allowing for diversification across geographies and asset classes
(David Blood and Judith Rodin, 2010).
Compared with traditional investments in established asset classes, impact investment is only
now emerging from infancy. Many of impact investors have achieved substantial scale but
many others remain medium or small. (David Blood and Judith Rodin, 2010)

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2.4. Stock Market and Investment Decision
In a study conducted by R. Glenn Hubbard (1998) it was shown that analyses of the
investment decision takes an important place in research programs in macroeconomics,
public economics, industrial organisation, and corporate finance, as it was driven by
theoretical concerns and policy questions. A number of researchers have extended
conventional models of business. This research program has proceeded in two steps. In the
first, many models of asymmetric information and incentive problems in capital markets have
implied that information costs and the internal resources of a firm influence the shadow cost
of external funds for fixed investment, holding constant underlying investment opportunities.
In the second, empirical studies have focused on ways to isolate effects of information costs
and internal resources on investment, independent of changes in investment opportunities (R.
Glenn Hubbard, 1998).
In the new global economy, investor’s decision process become a central issue and
investigating this process is based on finding the answers that can explain stages to the final
decision made. Stock prices and real investment are strongly connected. The first explanation
relies on the hypotheses that stock prices reflect information about firms fundamentals.
Assuming that fundamentals about firms affect real investment decision, it is obvious that
managers should observe positive correlation between stock prices and real investment when
prices reflect such information. Below second explanation lying on constrains the hypotheses
that firms face financing that prevents them from pursuing their optimal investment plans. An
increase in stock prices will make financing constrains less binding by making equity
financing less costly , and will thus enable firms to increase investments (Chen, Q.,
Goldstein, I., & Jiang, W. 2007)
Preliminary work undertaken by Scharfstein, D. S., & Stein, J. C. (1990) suggested that
investment decisions reflect agents’ rationality formed expectations: decisions are made using
all available information in an efficient manner. On the other hand, investment is also driven
by group psychology, which weakens the link between information and market outcomes.
There is also stated that a numbers of settings in which this kind of heard behaviour might
have important implications. It is easy to assume that there are two types of managers: ones,
who received informative signals about the value of an effective investment in stock market,
and ones, who received purely noisy signal and regarding that made an investment
(Scharfstein & Stein, 1990).

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According to research findings conducted by Campello, M., & Graham, J. (2007),
increasingly suggested that the stock market is not driven solely by news about fundamentals.
Whether stock prices influence the real economy becomes a relevant concern when markets
experience price bubble. In the face of widespread mispricing, it can be rather difficult for
arbitrageurs to bring values back to fundamentals. When managers work in the best interest
of stakeholders, they should sell they firms stock whenever equity is overloaded. Managers
should do so even when their private assessment of investment productivity is lower than that
of investment (Campello, M., & Graham, J. 2007)
2.5. Decision Making Process
A recent study by Thomas L. Saety (2008) published the paper in which he described that
each of us is fundamentally decision makers. In order to make a good judgment for effective
decision, every person is gathering a bunch of useful information that helps us understanding
occurrences and fundamentals. Based on this information we are making decisions. There is
no every information is useful, but we believe that each of them can lead us to make good
decision. (Thomas L. Saety, 2008)
Further following Thomas L. Seaty research has stated that decision making process involves
measurement intangible factors in decisions for a long time, defied human understanding.
Assuming that numbers and measurements belong to mathematics, as essential science, gives
us a sign that all things can be assigned from minus infinity to plus infinity in same way. This
statement clearly describes that each of us in decision making process need to have some
fundamental understanding to this processes that nature endowed us which helps us making
choices to help us survive. (Thomas L. Saety, 2008)

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Figure: 2.1 DECISION MAKING PROCESS
Source: (Shyama Shankar, Mart 2014)
Decision making process in the real world takes place in environment where goals are not
known precisely; therefore people usually employ the concepts and techniques of probability
theory and the tools provided by decision theory, control theory and information theory.
Specifically, it means that there is a need for differentiation between randomness and
fuzziness, with the latter being a major source of impression in many decision processes
(Zimmermann, H. J. 2012).
2.6. Strategic Decision Making Process
Preliminary work on strategic decision making process was undertaken by Walker, R. M et.al
(2010), and reports that for a long time strategic decision making process has been of great
interest for organisation theory and strategic management. Many findings described and
explained that strategic decision making processes influence decision’s effectiveness. There
is always a question of whether the success of strategic decision depends on the steps
managers use to make them. It is fundamental to organization theory, as strategic decision
making is a key element of management-cantered conceptions of organisation. A number of
authors have reported analyses of trends in strategic decision making processes and

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challenged effectiveness of decision made by individuals or group of managers (Walker, R.
M., Andrews, R., Boyne, G. A., Meier, K. J., & O’Toole, L. J. 2010).
Further, assuming that strategic decisions are the responsibility of managers they also reflect
the interaction between an organisation and its environment and show how an organisation
managers this relationship. They can be formal and informal and can be intended and
emergent. Managers deal with concerns which are essential to the livelihood and survival of
the organisation and usually involve the large portion if the organisation resources in order to
bring effective decision. Regarding managers responsibility in an organisation and all
resources involved in decision making process, it is important to state that decision that is
considered strategic in one organisation or industry may be less strategic in another industry
or organisation (Elbanna, S. 2006).
An organization is influenced and its performance majority depends on which decision has
been brought by management team. Further, strategic decision addresses complex issues that
involve large amounts of organisational resources. It is obvious think that decision making
has been heavily researched. As a result of this research conducted by Amason, A. C. (1996),
have been stated that focusing on the quality of the decision themselves, has identified two
principal antecedents of decision quality: the cognitive capabilities of a top management team
and the interaction process through which the team produces its decision (Amason, A. C.
1996).
According to Korsgaard, M. A., at.el. (1995), managers often work in teams to make such
decision because of complexity of the issues assessing capacity and ability of every
individual that will convey their decision. The ultimate value of high-quality decisions
depends to a great extends upon the willingness of managers to cooperate in implementing
those decisions. Therefore, effective decision processes should consider not only the quality
of decision but also the impact of such processes to organisation regarding employees who
have to adapt to the process (Korsgaard, M. A., Schweiger, D. M., & Sapienza, H. J. 1995).
Through this research on decision making process, there is no way to make conclusion
without critical review on adaption after effective decision is made. As the obstruction of
disruption that is characteristic in modern business environment increases, adoption becomes
a critical task faced by organisation, and is expressed by three related themes in the
management literature: strategic change, innovation, and decline. Research in each of this
areas demonstrates that the failure to adopt is common, even when need for change is

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manifest. Those facts gave us right to assume that adaption is fundamentally a series of
choices about how the organisation should respond to perceived threats or opportunities. This
also proves suggests that any proposal for potential change in an organisation have to be
approved by to executives, as a part if decision-making process (Walker, R. M., Andrews, R.,
Boyne, G. A., Meier, K. J., & O’Toole, L. J. 2010).
Barclays Capital, as a leading world bank, had to consider needs of stakeholders in the
decisions it makes in short and long term investment processes. In order to satisfy investors
and shareholders, BC has developed a value-based decision-making tool by considering the
broader societal and environmental impacts of BC business decisions (@Barclays 2015).
2.7. Ethical Decision Making
The ethical decision making in organisation become big issue in recent years because of
many different reasons. An understanding of ethical decision making in organisation is
important for development of organisational progress. For instance, ethical issues are ever
present in uncertain conditions where multiple stakeholders, interest, and values are in
conflict and laws are unclear. Managers engage in discretionary decision-making behaviour
affecting the lives and well-being of others. Their decision and acts can produce tremendous
social consequences, particularly in the realms of health, safety and welfare of consumers,
employees, and the community (Ashkanasy, N. M., Windsor, C. A., & Treviño, L. K. 2006).
Ashkanasy, N. M., et.al. (2006) pointed out an agreement of set of moral principles values is
important in decision making processes. It is proved by decision maker’s agreement that their
decisions should be made in accordance with accepted principles of right or wrong. They
agree that constitution of ethical behaviour reduces as the level of analyses proceeds from
general to the individual. Because if that, it is difficult to find incidents of deviant behaviour
which decision makers would agree are unethical. Absence of the clear consensus about what
is ethical for decision makers may have negative impact for the business (Ashkanasy, N. M.,
Windsor, C. A., & Treviño, L. K. 2006).
It is impossible to develop a framework of ethical decision making without evaluating
normative ethical standards derived from moral philosophy and individual factors such as
age, gender and other demographic characteristics. Based on the emphasis of normative
approaches in the literature, it is assumed that investors develop guidelines and rules for
ethical behaviour based on moral philosophy. Various philosophies related to utilitarianism,

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rights, and explain how individuals create ethical standards (Ferrell, O. C., Johnston, M. W.,
& Ferrell, L. 2007).
Section 2:
2.8. Factors that can affect effective investment decisions
Reach amount of literature analysed trough research related to factors that can affect effective
investment decisions pointed out that is high possible to divide them into three different
groups. Purpose of dividing factors into groups is to make research approachable and
understandable for further data collection and also better evaluation of results and
recommendation.
Figure: 2.6.
Source: (Researcher Milos Stanojevic, 2015)
Summarizing literature come out idea that there are general factors that are affecting decision
making process for effective investment that is familiar for every country. It is general
globally regarding macroeconomic circumstances and is been followed by very similar
reactions by investors. Characteristic factors are more brought up by events in
macroeconomic such as credit crunch etc., which are creation of global economy condition
and characteristic for them is a reason how they evaluate and taking a place in investors’
life’s. Third and last group is specific for every market differently. Assuming that stock
market is aggregating different stock prices which are fluctuating constantly according to a
polices which are different in every country independently gave us right to assume that there
are some specific factors in given stock market different from others.
GENERAL FACTORS
CHARACTERISTIC FACTORS
SPECIFIC FACTORS

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Further this research covers the most important factors that can affect investors decision
making process for effective investment and tends to conclude each of factor with clear
differentiation trough stated groups.
2.8.1. Policy Uncertainty and Investment
There are relatively few historical studies in the area of investment that indicates heavily-
indebted condition of developed countries during many crises in past few decades. Many of
these countries during Great Recession and recovery time had to undertake comprehensive
economic measures, macroeconomic factors and structural changes. Governments also have
been punished and under circumstances convinced to undertake large number of stabilization
programs which generally presented as poor private investment response to these reforms
known as policy uncertainty. This trend has been followed by most of the governments
worldwide, which immediately classified those factors as a general. Previous studies have
reported that consideration of an economy where policy reform has just been introduced is of
crucial importance to find out how policy uncertainty affects investors and their decision
making process (Baker, S. R., Bloom, N., & Davis, S. J. 2013)
In recent years, there has been a an increasing amount of literature providing findings that the
most frequent policy uncertainty concern taxes, spending, monetary, and regulatory policy. In
a same time the increase in policy uncertainty since 2008 mainly reflects greater uncertainty
about tax, spending and regulatory policy. According to this we can assume that interest in
economic uncertainty has surged with the claim it played an important in the Great Recession
and recovery. It is evident that policy uncertainty rose to unusually high level from the 2007-
2009 recessions onwards (Baker, S. R., Bloom, N., & Davis, S. J. 2013).
2.8.2. Sources of Policy Uncertainty
It would be inappropriate to continue this discussion about policy uncertainty without listing
their sources. Aimed to solve this problem researcher find out available sources called sub-
indices for specific policy areas, like taxes, monetary policy and regulation. There are many
of articles based to satisfy all the search criteria for policy uncertainty index including
category specific terms such as “Federal reserve Board”, “The Fed”, official statements about
current interest rate or inflation, taxes-including taxes policy (Baker, S. R., Bloom, N., &
Davis, S. J. 2013).

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2.8.3. Tax Policy and Investment Behaviour
Taxes and tax policies are the most frequent stated problem regarding investor’s behaviour.
The effectiveness of tax policy in altering investment behaviour is an article of faith among
both policy makers and economists. Different simulative packages have been a greatest way I
economic policy to satisfy investors. Use of policy instruments where in direction of more
general, all sorts of liberalised depreciation schemes, investment allowance, and tax
exemptions in developed countries (Robert E. Hall and Dale W. Jorgensen, 2006).
This research has an opportunity to undertake and investigate all those factors and to give
good picture and description how these tax policies can affect new investors (Robert E. Hall
and Dale W. Jorgensen, 2006).
In addition to this, researcher found interesting to bring this article under consideration
because of different tax policies that depends on country and government decision. Tax
policies and regulations are instantly present in every country and they have been government
tool for a long time. Therefore, it is a general observation of taxes and polices world-wide,
but differentiation is specific for every country independent.
2.9. Fiscal Policy, Profits, and Investment
Existing research conducted by Alesina, A., at.el. (1999) have stated that there are
connections between fiscal policy, profits and investment. Effective investment decision has
to be strongly aware of rules and policies in order to become profitable. Fiscal policy in many
developed countries has experienced large swings as many recent literatures have pointed out
importance of effects of fiscal policies. Effects of taxation and expenditure on investment and
its profit had a magnificent sign which proved our awareness that changes in fiscal policy
greatly can affect investment and profits (Alesina, A., Ardagna, S., Perotti, R., &
Schiantarelli, F. 1999).
For instance, reduction in public spending reduces investment and, therefore profits. The
same reductions in investment profits have increase in taxes but magnitude of this tax effects
is smaller than those on the expenditure side. The estimated effect of spending and taxes on
investment imply that the different composition of the stabilization can account for the
observed difference in investment growth rates. This point lead us to assume that large fiscal
adjustment does not need special theories to explain those effect on investment and profits. It

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is usual adjustment to newly fiscal policies which cannot be by passed (Alesina, A., Ardagna,
S., Perotti, R., & Schiantarelli, F. 1999).
Even if many of research would admit that fiscal policy, profits and investment does not have
familiar touches, this research proudly paid attention to prove opposite and state this
connection on a high level of leader for future investments. It is kind of general state, but
future investments should highly consider fiscal policy involved in investment and to define
it’s characteristic to maximize profits.
2.10. Political Instability and Investment
Growing body of literature review recognised the importance of political instability that may
have a big impact on investor’s decision making process. The latter, by increasing the
probability of coups, revolutions, mass violence or, more generally, by increasing policy
uncertainty and threatening property rights, has a negative effect on investment and, as a
consequence, reduces growth. Several authors have recently argued that income inequality is
harmful for growth: in more unequal societies, the demand for fiscal redistribution financed
by distortionary taxation is higher, causing a lower rate of growth. Therefore, this research
will be also focused the effects of political instability on growth and investment behaviour
according to similar events occurring in world (Stasavage, D. 2002).
Further in this research was found that social and political instability are variables that are
hard to define and measure in a way which can be used to place an effective investment.
Political instability can be measured from two ways: constitutional (government changes) and
socio-political changes which are measured trough index which summarises various variable
including phenomena of social unrest. Each of this measures is not really clear, therefore is to
conclude that decision in such a case may depend upon specific issues under consideration.
(Stasavage, D. 2002).
After pointing out reasons and effects caused by political instability, this research moved
forward and start looking if there is any political institution that can help effective investment
in such an economical condition. North and Weingast (1989) proposed that political
institutions characterized by checks and balances van have beneficial effects on investment
by allowing governments to credibly commit not to engage in ex past opportunism with
respect to investors. This finding has major implication for developed countries, where
investors may be particularly wary of the potential for radical changes in economic policy.

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Followed to this summarise says that while increasing the level of checks and balances in a
country can increase policy stability. This suggested that government in political system with
high checks and balances will find it easier to credibly commit, but is also likely to see grater
variability in levels of private investments within the set of observations where checks and
balances are low (Stasavage, D. 2002).
2.11. Stock Market Events
Assuming that trough literature reviews this research covered many different factors that can
affect effective decision making process for effective investment; it would be helpful to turn
towards stock market functions and reactions of stock market prices according events that
occur in an economy environment.
Assumption of numerous articles and journals has shown that share prices reflects the
underlying economic value of assets, changes in equity values will properly capture expected
changes in the economic profitability of the company. This requires us to accept that stock
markets are efficient and that prices reflect all publicly available information relevant to the
prospect of the company. Therefore this effect of the event will be directly reflected on the
price of the company assets (Beverley, L. 2008).
Regarding those events that affect stock market prices, it is important for bringing a right
investment decision to follow fundamental requirement for any event available of at least one
listed financial instrument that tracks the value of firms. Identifying those events is from huge
interest for making effective investment decision, as well as, identifying the information prior
to the events. This is also called speculation on the content of an announcement before it is
made; or take time to adopt information and then react to it (Beverley, L. 2008).
2.12. Stock Prices and Investment
Stock prices and real investment are strongly correlated. It was from huge importance to
assume findings of recent research conducted by Chen, Q., and et.al. (2007), who offered two
main explanations for this high correlation. The first explanation relies on the hypothesis that
stock prices reflect information about firm’s fundamentals. If this fundamental information
about firms make a real effect on investment decision observed by managers, it is likely to
observe positive relationship between stock prices and real investment when prices is
reflected in such a way (Chen, Q, Goldstein, I., & Jiang, W. 2007).

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Om the other side, second explanation was based on hypotheses that firms face financing
constraints that are used as prevention from pursuing their optimal investment plan.
Therefore, an increase in stock price will make financing constraints less binding by making
equity financing, and will thus enable firms to increase investments (Chen, Q, Goldstein, I.,
& Jiang, W. 2007).
Identifying what drive stock market return is of huge importance for investors and policy
makers. The decision to invest in stock requires more than only assessment of the risk return
trade-off given of existing data, but also an act of trust that the data in managers possession
are reliable and that the overall system is fair (Guiso, L., Sapienza, P., & Zingales, L. 2008).
2.13. Strategic as Strategic Decision Making Process
(measurement)
As research was going further and discovered many of understandings regarding decision
making process important for creating an effective investment opportunity it wouldn’t be
valuable if application is missing. Trough research it was proven that executives release that
to prosper in decision process they need to turn into fundamental issue of strategy.
Involvement in selecting attractive market, choosing a defensible strategic position, or
building a core competencies, analysing and predict industries, competencies, or strategic
positions will be valuable for challenge of actually creating effective strategy (Eisenhardt, K.
M. 1999).
Many managers of successful companies have adopted a different prospective on strategy and
the most important of those approaches is to know answers on “where” and “how” to create
continuing flow of temporary and shifting competitive advantages. The ability to make fast,
widely supported, and high-quality strategic decision on a frequent basis is the cornerstone of
effective strategy. To use of language of contemporary strategy thinking, strategic decision
making is fundamental dynamic capability in excellent forms (Eisenhardt, K. M. 1999).
Section 3:
Conclusion:
Last few years have seen the development of many new models for understanding how
people make decisions in real world settings. This research has been focused to find out and
discuss all the processes involved in order to make an effective decision for successful

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investment. After careful consideration of basic understanding of decision making process
research rise a question how it works in practice. Defining a meaning of decision-making we
also find out that it very depends on managerial activities. It was important to critically
approach to a breakdown of strategic process and exercise each phase involved in such a
process: strategic, operational, and tactical, and also to critically analyse management
activities through adoption of such a decision.
Through this research was shown that analyses of the investment decision takes an important
place in research programs in macroeconomics, public economics, industrial organisation,
and corporate finance, as it was driven by theoretical concerns and policy questions.
Regarding many different factors that can affect decision for an effective investment we have
stated trough research the most important factors and also named them as important factors
that investors have to be aware of: tax policies, political instability, government policy
uncertainty, fiscal policy etc.
Decision making process involves measurement intangible factors in decisions for a long
time, defied human understanding. Assuming that numbers and measurements belong to
mathematics, gives us a sign that all things can be assigned from minus infinity to plus
infinity in same way. This statement clearly describes that each of us in decision making
process need to have some fundamental understanding to this processes that nature endowed
us which helps us making choices to help us survive and make companies become adoptive
to new decisions in order to achieve their business goals.
Regarding everything that this research discovered, it has built up theoretical foundation for
effective investment decision making process. Practical part that is needed to complete this
work will be summarised and presentation of results and data collected through questionnaire
from experienced investors. Purpose is to compare theoretical and practical findings in order
to develop the best recommendation for future decision making process for effective
investments.

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CHAPTER 3
Methodology
3.0. Introduction to Research Methodology
In a history of development economies, according to S. Rajasekar et al, (2013) research
methods have been thought of as one of key factor for gaining the success in business.
Research is logical and systematic search for new and useful information on a particular
topic. It is process of finding solutions to scientific and social problems through objectives
and systematic analyses. As topic of this research is “Evaluation of Decision Making
Process of new Investment in Stock Exchange for Effective Investment” it tends to discover
and present information useful for further effective investment in such environment as it is
Stock Exchange and investment division (S. Rajasekar, P. Philominathan, V. Chinnathambi,
2006).
Therefore, every research should follow its objectives on the way of searching valuable
information regarding topic. Essence of objectives for research is:
 To discover new facts
 To verify and test important facts
 To analyse an event or process or phenomenon to identify the cause and effect
relationship
 To develop new scientific tools
 To find solutions to scientific problems
 To solve the problems occurring in our everyday life
There are a various reasons for undertaking a research. Motivation for this comes up
through consideration that research is aimed to discover new facts regarding his aims and
his/her specific goals. (S. Rajasekar, P. Philominathan, V. Chinnathambi, 2006)
Aim and objectives of this research have been crated in that way to find out information and
facts for evaluating our topic. Importance of research in this project took an important place
to simplify implementable solutions and suggestions required for taking new problems that
arises (S. Rajasekar, P. Philominathan, V. Chinnathambi, 2006).

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3.1. Meaning of Research
This research project believed that application of different methodology plays a vital role in
every business organisation. Such a research strategy can be used for analysing and solving
practical business problems, as well as for building and testing different business theories. In
order to collect valuable information, research project should be designed and conducted with
scientific austerity. The role of research methodology lately have been widely used by many
communities in business research which proves believes that the reason for that are results
provided once research is done. The contribution of exploratory research to theory-building is
well documented. Regarding documentation as a secondary data, every business research
requires skilled interviewers to make results of research powerful and applicable (Kothari, C.
R. 2011).
According to William G. et al. (2010), such actions are included in order to define business
opportunities, problems, generating and evaluating alternative courses of action, monitoring
employee and organisational performance. Purpose of applying those actions in chosen
organisation is to extend knowledge about business phenomenon, therefore managers can get
new ideas of solving problems, how to satisfy employees and also to develop a plan in
expanding their business (William G. Zikmund, Barry J. B, Mitch G. 2010).
In order to apply those actions on best possible way, it is important to realize difference
between methods and methodology. Research methods refers to a specific activities designed
to generate data, while methodology is more about researcher attitude and his understanding
and strategy in way to answer research questions (Greener, S. 2008).
3.2. Types of Research
In order to make a good project, it was important to pay attention to the research strategy that
may apply to the project. Each strategy can be used in exploratory, descriptive and
explanatory research. . Decisions on which research strategy will be used in project depend
on research questions and objectives, the amount of time and other resources that are
available. According to the Mark Saunders et.al (2011), there are several strategies
considered subsequently in the book:
 Experiment
 Survey

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 Case study
 Action research
 Grounded theory
 Ethnography
 Archival research
Experiment is a form of research that owes much to the natural science, although it features
strongly in much social science research, particularly psychology. The purpose of an
experiment is to study causal links (Saunders, M, et.al 2011).
The survey strategy is usually associated with the deductive approach. It is popular and
common strategy in BUSINESS AND MANAGEMENT research and is most frequently
used to answer who, what, where, how much and how many questions (Saunders, M, et.al
2011).
The purpose of survey strategy in this project was to collect qualitative data from chosen
population of 8 respondents’ (target group), which can be used to analyse qualitative using
descriptive and inferential statistics. Survey strategy gave a more control over the research
process, and it helped to generate findings that are representative of the whole population at a
lower cost that collecting the data for the whole population (Saunders, M, et.al 2011).
Case study is a strategy for doing research which involves an empirical investigation of a
particular contemporary phenomenon its real life context using multiple sources of evidence.
This research has been focused to apply case study of Barclays Capital in order to find out
more valuable information regarding decision making processes for effective investment in a
stock market (Saunders, M, et.al 2011).
According to Yin (2003) there are four case study strategies based upon two discrete
dimensions:
1) Single case v. Multiple case;
2) Holistic case v. embedded case.
Action research is been interpreted subsequently by management research in a variety of
ways, but there are four common themes with the literature:

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 The first emphasises the purpose of the research
 The second relates to the involvement of practitioners in the research, and a
collaborative democratic partnership between practitioners and researchers
 The third emphasises the iterative nature of the process of diagnosing, planning,
taking action and evaluating
 The fourth theme suggests that action research should have implications beyond the
immediate project; it must be clear that the result could inform other context
Grounded theory is the best example of the inductive approach. As followed through this
research, grounded theory strategy is particularly helpful for research to predict and explain
behaviour, the emphasis being upon developing and building theory. Grounded theory can be
used to explore a wide range of business and management issues (Saunders, M, et.al 2011).
3.2.1.Research Onion Model
Figure: 3.1.1.
Source: (Saunders, M, et.al 2011)

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3.3. Research philosophies
Applying research strategy to this research have played vital role for been able to collect
valuable data on the way to evaluate and discover issues stated trough objectives of this
research. Realizing relationship between data and theories helped researcher to realise that
design of research depends on the applied research philosophies, as a nation of research
design. After research philosophies took a place in research design it was easy to consider
that main philosophical factors affect overall arrangement to satisfy outcomes from the
research activity (Saunders, M, et.al 2011).
3.3.1. Ontology and epistemology
Further applying research philosophies to the research design firstly had to consider
difference between ontology and epistemology, as their assumption is important for
developing methodologies for conducting research (Easterby-Smith, et.al. 2012).
As ontology is more about nature and existence, it also draws parallels between debates
within the natural science and the social sciences which also draw the parallel comparing
realism and relativism. Regarding this statement and assuming philosopher thoughts,
realism concern for facts or reality and rejection of the impractical or visionary. It is
actually a theory of writing in which the ordinary, familiar, or mundane aspects of life are
represented in a straightforward or matter-of-fact manner that is presumed to reflect life as it
is. (Easterby-Smith, et.al 2012).
On the other hand, epistemology is about different ways of inquiring into the nature of
physical and social worlds. Based on this, it is likely to assume that epistemology focuses
around the respective merits of two contrasting views of how social science research should
be conducted: positivism and social constructionism (Easterby-Smith, et.al 2012).
3.3.2.Positivism
The interpretive approach to organizational research has been gaining attention as an
alternative to the more traditional positivist approach. The framework of this research has
been set to achieve particular goals mostly through positivist framework that brought many
benefits from using their interpretive procedures in addition to their positivist procedures
(Johnson, R. B., & Onwuegbuzie, A. J. 2004).

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The positivist approach to organisational research puts into practice a view of science that
has its origins in a school of thought within the philosophy of science known as “logical
positivism”. This approach has been explicitly recognised as the natural science model of
social-science research, and has found wise-spread application in social science in general
and in organisational research in particular (Johnson, R. B., & Onwuegbuzie, A. J. 2004).
In positivism the role of the researcher is limited to data collected and interpretation through
objective approach and the researcher findings are usually observable and quantifiable.
According to the principles of positivism, it depends on quantifiable observations that lead
researchers to statistical analyse. Positivism is in accordance with the empiricist view that
knowledge stems from human experience (Lin, A. C. 1998).
Further research shows that in positivist approach, a scientific explanation is expressed in
formal proposition. This is important because the rules of formal logic provide a powerful
means by which to relate propositions to one another, and to deduce new ones (Johnson, R.
B., & Onwuegbuzie, A. J. 2004).
3.3.3.Phenomenology
Many structures of research are installed to give a good understanding and seek for causes
of phenomena without considering the subjective states of researchers or study participants.
This was a reason for researchers to consider phenomena and concern human behaviour
(Davis, K. 1991).
Phenomenology, therefor, provides a philological perspective for understanding and
completing structure of research. By phenomenology, design of research, researcher should
take under consideration understanding of ordinary people not by examining its structure,
but by accounting for the ways individuals define and reflect trough situation and action. It
also suggests that researcher should not reduce subjects to isolated variables or to more
members of a culture but allow researcher to study people as they define and first
experience abstract concepts (Davis, K. 1991).
It is also important for researcher to take under consideration phenomenological philosophy
in the analyses of data collected during research project. The reason is that phenomenology
suggests that objective understanding is impossible and meaning is actually located in the

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humanness of the observer, not in the observed phenomena, the philosophy has major
implications for our understanding of data analyses (Davis, K. 1991).
In order to conclude the research, considering phenomenology, based on qualitative research
method through inductive approach, researchers conclusion is aimed to be descriptions of
own constructions of reality conducted by 10 experienced professionals chosen from
population involved in investment business using sampling techniques (Davis, K. 1991).
3.4. Research Approach
As every research project involves use of theory, it is important that researcher is clear about
which theory at beginning of research raises an important question concerning the design of
research project. At this point researcher is facing possibility to choose whether is going to
use deductive or inductive approach (Saunders M. et. al.2011).
Deductive approach is based on developing a theory and hypothesis, and designs a research
strategy to test hypotheses. In addition to this, deduction involves the development of the
theory that is subject to a rigorous test. It is dominant research approach in the natural
science, where laws present the basis of explanation, allow the anticipation of phenomena,
predict their occurrences and therefore permit them to be controlled (Saunders M. et
al.2011).
In order to discover information from experience and practice presence, involving inductive
approach to research was from big importance. Purpose of induction is to find out results
and information from employee or people involved in a same field of business involving
questioners crated for particular topic. It is crated to discover feelings, satisfaction,
misunderstandings, and other absence in order to understand better the nature of problem.
Research using an inductive approach is likely to be particularly concerned with the context
in which such events take a place. Therefore, a study of small sample of subjects would be
more appropriate than a large number as with the deductive approach (Saunders M. et
al.2011).
In addition to this, as probability derived from individual’s personal judgment about whether
a specific outcome is likely to occur. As probability is subjective and differs from person to
person, seems as best probability to apply in inductive approach for this research. Based on

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subjective probability of researcher, creation of qualitative (inductive) approach seems the
most beneficial for this research. .
3.5. Sampling Techniques
Regarding objectives of research, researcher has to consider using of sampling techniques in
order to provide valuable and qualitative research results. Sampling techniques provide a
range of methods that enable researcher to reduce the amount of data needed to collect by
considering only data from sub-group rather than all possible cases or elements. The full set
of cases from which the sample is taken is call population. Many often for some research
questions is possible to collect data from an entire population if is of manageable size.
Sampling provides a valid alternative to census when:
 It would be impracticable for researcher to survey the entire population
 The budget constrains prevent from surveying the entire population
 Time constrains prevent fro surveying the entire population
 Researcher has collected all the data but need the results quickly (Saunders M. et
al.2011).
Samples also save time. Occasionally, to save time, questionnaires are used to collect data
from the entire population but only a sample of data collected are analysed.
The sampling techniques available for researchers can be divided in two groups:
 Probability or representative sampling;
 Non-probability or judgmental sampling
Probability samples explain that is possible to answer research questions and to achieve
objectives the research requires to estimate statistically the characteristics of the population
from the sample. For non-probability samples, the probability of each case being selected
from the total population is not known and it is impossible to answer research questions or to
address objectives that require researcher to make statistical inferences about the
characteristics of the population. (Saunders M. et. al. 2011).
3.6. Triangulation
As this research were going further it was important to combine methodologies in order to
maximise output of the research. Collecting information for questions of research stated

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trough objectives was much easier trough triangulation of different methodologies (Jick, T.
D. 1979).
Triangulation is broadly defined as the combination of methodologies in the study of the
same phenomenon. In the social science a number of scientists developed the idea of
multiple operations with agreement that more than one method should be used in the
validation process to ensure that the variance reflected that of the trait and not of the
method. Triangulation is a tool for cross validation when two or more methods are found to
be congruent and yield comparable data (Jick, T. D. 1979).
Importance of triangulation strategy for this research was to combine quantitative
(deduction) and qualitative (induction) methods and approaches and through multiple
involved methods to examine the same dimensions of research problem. It is believed that
if multiple and independent methods achieve the same output and conclusions they would
provide a more certain portrayal of the phenomenon (Jick, T. D. 1979).
3.7. Types of Data Collecting
Decision to use focus group interviews as a data collecting strategy made researcher aware
of the luck of consensus on how to organize and execute them, including their composition
and the appropriate number of participants. As the aim of this research was to collect
valuable data for decision making process for effective investment in stock exchange,
therefore findings from secondary data collection made great foundation pointing out
shortcomings that are going to be discovered from focused population trough primary data
collection. Researcher has been using face to face interview and observations interview
questionnaire. Case study was helpful for this research in data collecting processes to prove
previous situation and discover shortcoming in order to create direction for further
investigation. Also, available documentation where helpful to prove facts collected through
interviews and questioners.
The target group of this research are managers, business participants and junior employees
in the field of business management. This will enhance a deeper knowledge about how
better a management functions could be if misunderstandings are wiped out and given
recommendations as a new tool.

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3.7.1 Secondary Data Collection
First consideration on how to answer the research question and meet objectives was based
on finding and analysing data that have already been collected and established for some
other purpose. This data is known as secondary data collection and include both raw data
and published summaries. High percentage of this data is available to public, while some of
them are available only from organisations or government departments of particular areas
(Saunders M. et. al.2011).
Documentary secondary data are often used in research projects that also use primary data
collection methods. Survey-based secondary data refers to data collection using survey
questionnaire, usually by questioners which usage in this research were very productive.
Further collection of survey-based secondary data was organised trough one of tree sub-
types of survey strategy: consensus, continuous/regular survey and ad hoc surveys.
Characteristic for ad hoc survey is that is usually one-off surveys and are for more specific
in their subject matter. They include questionnaires that have been undertaken by
independent researchers. As that, ad hoc sub-type survey is used in this research (Saunders
M. et. al.2011).
First step in this research was locating secondary data for literature review of this research
based on books, articles and journal that are already been established for some other
purpose. Further in this research, specific secondary data were available only from
organisations involved in investment business, as it is chosen area (Saunders M. et. al.2011).
3.7.2. Primary Data Collection
Primary data in this research have been collected through observation. By observations
means that researcher questions and objectives are concerned with what people do.
Participant observation is qualitative and derives from the work of social anthropology and
as that, has been used much less in in management and business research (Saunders M. et.
al.2011).
According to (Polkinghorne, D. E. 2005), qualitative research is aimed to describe and
clarify human experience as it appears in people’s lives. Qualitative data are gathered
primarily in the form of spoken or written language rather than in the form of numbers.
Possible data sources are interviews with participants, observations, and documents.

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Selection of interviews participants requires purposive and iterative strategy. Production of
interviews data requires awareness of the complexity of self-reports and the relation
between experience and language expression. To generate interview data of sufficient
breadth requires practiced skill and time (Polkinghorne, D. E. 2005).
3.7.3 Observations Interview Questionnaire
Observation essentially involves: the systematic observation, recording, description,
analysis, and interpretation of people’s behaviour (Saunders M. et. al.2011).
Through this research, it is possible to define two different types of observation: Participant
observation and structured observation (Saunders M. et. al.2011).
Participant observation is qualitative and derives from the work of social anthropology
and emphasis is on discovering the meaning that people attach to their action. Structured
observation is quantitative and is more concerned with the frequency of those actions
(Saunders M. et. al.2011).
Structured observation is systematic and has a high level of predetermined structure.
Using this method in data collection strategy, it is used to adopt a more detached stance.
Structured observation can collect only a part of collection approach because its function is
to tell to a researcher how often things happen rather than why they happen (Saunders M. et.
al.2011).
3.8. Methods of Data Collecting
The research method chosen for this study is the qualitative method. Firstly, it was important
for this research to make a difference between quantitative and qualitative research methods.
Nothing better captures the differences than different logics that undergird sampling
approaches. Qualitative inquiry forces in depth on relatively small samples, while
quantitative methods typically depend on larger samples selected randomly. Defining the
difference of those two methods we find that not only sampling techniques are different, also
each approach in unique because the purpose of each strategy is different (Patton, M. 1990).

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3.8.1. Qualitative Research Methods
Qualitative research involves an interpretive, naturalistic approach to its subject manner.
According to (Trumbull, M. 2005) qualitative research also involves the studies use and
collection of a variety of empirical materials-case study, personal experiences, introspective,
life story, interview, observational, historical, interactional and visual texts that describes
routine and problematic moments and meanings in individual lives. It is deductive approach,
with clear stated purpose to describe multiple realities, developing deep understanding, and
capturing everyday life and human perspectives (Trumbull, M. 2005).
Further, many other literature pointed out that qualitative inquiry is a set of multiple
practices in which words in methodological and philosophical vocabularies collect different
meanings in their use . Following this statement brings us that qualitative research is
designed to develop a theory. The researcher conducting qualitative research is attempting
to discover as much information about individual or phenomena under study by providing
detailed description. Qualitative research methods are designed to give real and stimulating
meaning to the phenomena by involving the researcher directly or indirectly in the process.
It is more likely for qualitative research to be presented as a data collected focused on
researcher analytical skills and level of communication, rather than in numbers (Trumbull,
M. 2005).
3.8.2. Quantitative Research Methods
Quantitative research is explaining phenomena by collecting numerical data that are
analysed using mathematically based methods. Therefore, quantitative research is essentially
about collecting numerical data to explain a particular phenomenon, particular questions
seem immediately suited to being answered using quantitative methods. Qualitative research,
as an inductive approach, is designed from the set of methods that includes interviews, case
studies, ethnographic research and discourse analysis. The results in quantitative research
methods are presented using statistics, tables, and graphs (Saunders M. et. al.2011).
The aim of quantitative research method is to test pre-determined hypothesis and produce
generalizable results. The result of quantitative research can conform or refute hypothesis
about the impact of a disaster and ensuring needs of the affected population. Conclusion

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made from analysis of quantitative data indicates how many are affected, where the greatest
are of impact is, and what are the key sector needs (Saunders M. et. al.2011).
According to this view, two fundamentally different worlds underlie quantitative and
qualitative research. The quantitative research is seen as realistic or sometimes positivism,
while qualitative research is more often categorised as subjectivism (Saunders M. et.
al.2011).
Quantitative data Qualitative data
 Based on meaning derived from
data
 Collection results in numerical
and standardised data
 Analyses conducted through the
use of diagrams and statistics
 Based on meanings expressed through
words
 Collection results in non-standardised
data requiring classification into
categories
 Analyses conducted through the use of
conceptualisation
Figure: 3.7.2.
Source: (Mark Saunders et al.2009)
3.9. Ethics of Research
Before started with research project, it is important to consider research ethics and act
ethically for a success of research project which was important for collecting both primary
and secondary data. Research ethics relate to questions about topic, design of research,
access and collect data, process and store data, presentation, etc. In order to achieve the best
results, this project has applied both philosophical prospective: theology and deontology
(Davison, R. N., 2002, January).

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CHAPTER 4
Data Analyses and Presentation
4.0. Introduction of Data Analyses and Presentation
As this research tends to collect data in order to achieve research aims and give answers to
questions produced according to objectives, further step of analysing and presenting them is
common sense for the project. Trough research collected data is in a raw form, therefore this
data have been processed and presented on understandable way for wide auditory (Saunders
M. et. al.2011).
Qualitative refer to data that can be quantified and can be product of all research strategies. It
can range from short list of responses to more complex data such as transcripts of in-depth
interviews or entire policy documents. To be useful, as well as quantitative, this data has to
be analysed and the meaning understood. Qualitative data analyses and procedures allows
researcher to develop theory from collected data. It includes both deductive and inductive
approaches and range from the simple categorisation of responses to processes for identifying
relationships between categories (Saunders M. et. al.2011).
In this research use of questionnaires is as a general term to include all techniques of data
collection in which each person is asked to respond to the same set of questions in a
predetermined order (Saunders M.et. al.2011).
Interview:
Interviewing provides a way of generating empirical data about a social world by asking
people to talk about their lives and experience. Regarding this statement, we can assume that
interviews are special forms of conversation. These conversations can be structured,
standardized, quantitatively oriented survey interviews, to semi-formal guided conversations
and free-following informational exchanges, all interviews are interactional. The most of
books established in recent year suggested that the interview conversation is pipeline for
transmitting knowledge. This fact is significant since the nature of any interview should be
consistent with research question and objectives, the purpose of research and the research
strategy that is adopted in this research (Holstein, J. A. & Gubrium, J. F. 2004).

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After careful collecting of data, data have been suitably anonymised, appropriately stored for
analysis, and grammatically corrected as a part for preparation for presentation. As deductive
approach have been used for qualitative research methods, in this research, researcher also
created deductive approach for analysing and presenting results including pattern matching
(with dependent and independent variations) and explanation building. All results have been
passed through tree stages:
 Summarising of meanings;
 Categorisation of meanings;
 Structuring of meanings using narrative (Saunders M. et. al. 2011).
Question 1:
What is importance of decision making process for new investment in stock exchange?
Answer 1:
Respondent 1: Philip Koncar: Answer from 3th respondent seemed as the most powerful
therefore researcher decide to present his opinion.
Regarding respondent 1, importance of decision making process for effective investment in
stock exchange takes a crucial part in investment environment. According to his statement,
making decision for effective investment have to take under consideration all the factors
involved in such a business environment as well as considering analyses and agreements
from different management levels.
Respondent 2: Decision making process is believed the most important part in investment
business, especially for a long term investments. Every department involved in decision
making process have to bring certain decisions, therefore without right decision company
wouldn’t exist, and decision for effective investment depends on number of other decisions
and analyses brought by different departments involved in that business.
Overall view of other respondents: Regarding other respondents research find that there are
no many different opinions. It seems that importance of decision making process take a
important role for effective investment and surely is driven by considering many information
before making an effort.

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Collected data from secondary research pointed out that decision making process depend on
people involved in this process. It is a natural process that must be treated as a scientific
activity to meet nature’s and people’s requirement. As known that are many factors affecting
decision making process, as a start point it is crucial to identify field of operations and then
process information to the further level. Evaluating decision making process for effective
investment opportunity to invest in a stock market discovered that successful decision must
survive the difficulties and hazards of the environment (Saaty, T. L. 1999).
Question 2:
Do you bring decisions to invest by yourself or decision is brought by management level
including more than one manager?
Answer 2:
Respondent 1: Assuming words from owner of multinational company, who participate to
share his experience regarding investments in stock market, he has thoughts that decision
making process is not easy part in investment environment.
Firstly, he pointed out that decision making process has to pass through many stages. He
suggested that right information in right moment plays a vital role for effective investment.
Every information such as macroeconomic condition, fundamental situation in economy,
political situations worldwide, and real factors that drive stock market prices, has to pass
through management in order to collect different views and different opinions. There are
different occasions in stock markets therefore, there is not everybody willing and strong
enough to decide. He said that even there are many experienced managers employed in his
company, because of their safety they sometimes avoid to take risk.
Overall view of other respondents: Only small different opinion had 2 of respondents who
suggested that effective investment have to gather decisions by experienced senior managers
and that senior managers have to take risk and responsibilities for further decision making
process for effective investment.
As analysed in chapter 2.6. literature review, an organization is influenced and its
performance majority depends on which decision has been brought by management team.
Further, strategic decision addresses complex issues that involve large amounts of
organisational resources. As a result of this research conducted by Amason, A. C. (1996), the

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quality of the decision themselves, has identified two principal antecedents of decision
quality: the cognitive capabilities of a top management team and the interaction process
through which the team produces its decision (Amason, A. C. 1996).
Question 3:
How much impacts have adopting of new strategic decision in investment environment?
Answer 3:
Respondent 1: Adoption of new strategy in investment environment does have an impact but
that is usually easy to avoid. Usually there is a short period of adoption of employees who use
to work before by certain rules. The most of investment companies are using similar strategy,
therefore if there are small changes in any way it is easy to survive.
Respondent 2: This respondent also agreed with statement gathered by respondent 1, adding
to it, that there are no many employees that are having a hard time to adapt to newly strategy,
which also makes easier for people who are responding to change strategy in investment
environment.
Overall view of other respondents: Regarding impact of new strategy in investment
environment all respondents had same opinion. It is clear to conclude that many companies
who are operating in same field use a similar strategy, therefore if there are small changes
there are not making big impact trough adopting process.
An organization is influenced and its performance majority depends on which decision has
been brought by management team. Further, strategic decision addresses complex issues that
involve large amounts of organisational resources. It is obvious think that decision making
has been heavily researched. As a result of this research conducted by Amason, A. C. (1996),
have been stated that focusing on the quality of the decision themselves, has identified two
principal antecedents of decision quality: the cognitive capabilities of a top management team
and the interaction process through which the team produces its decision (Amason, A. C.
(1996) (see chapter 2.6.).

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Question 4:
How much measurements of decision making process can affect new effective investment
regarding time, funds, and human resources involved in such actions?
Answer 4:
Respondent 1: Once you chose familiar market to invest all other ideas are less important.
The most important for investors is to choose sector that suits them the most. Further steps
regarding measurement are individual.
Respondent 2: every investor investing in stock markets is not able to follow all market
prices and movements. It is obvious think that investors are focused on particular sectors that
are the most convenient to them. The rest depends on resources available for investment and
market condition that should be a sign when that investment should be paid of.
Overall view of other respondents: As each of participants have a different section of
market where operates it is likely to see that that particular sector suits him, we have to
assume all other measurements still depends on company resources proposed for investment.
Many managers of successful companies have adopted a different prospective on strategy and
the most important of those approaches is to know answers on “where” and “how” to create
continuing flow of temporary and shifting competitive advantages. The ability to make fast,
widely supported, and high-quality strategic decision on a frequent basis is the cornerstone of
effective strategy. To use of language of contemporary strategy thinking, strategic decision
making is fundamental dynamic capability in excellent forms. (Eisenhardt, K. M. 1999) (See
chapter 2.13.).
Question 5:
Which factors can affect effective investment decisions and have huge impact that you
experienced in past few years involved in this business?
Answer 5:
Respondent 1: Information gathered from this respondent give us figures what is the most
important factor that he experienced. He suggested that the biggest scarf on his investment
experience have been earned after Mortgage Crush 2009. From his prospective group of

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economic and political factors are always present in global economy environment that can
pull each other and produce big stock market reaction which always comes as surprise. He
also suggested me to have a look back in history of stock market and find out that every 10-
15 years global economy have crush.
Respondent 2: According to findings from 2nd respondent, he strongly agrees that credit
crunch 2007-2009 affected many investors worldwide. He also suggested that in investment
business always have to be aware and expect unpredictable to happened, as well as, problem
in oil prices during problem with Syria and Egypt, which also made him losing funds because
of political uncertainty worldwide.
Overall view of other respondents: Reading primary data collected from participants,
research have found that each of them have experienced same fate and suggested exactly the
same. Based on this finding, conclusion presents that macroeconomic instability as a result of
many political and economic factors always make big impact. It was crucial for this research
to prove these findings and also to find further recommendations for further making decisions
for effective investment.
As findings from literature review suggested, it is difficult to understand and analyse how
real investors and markets have real relationship with each other, because of market
uncertainty. In the context of historical ground of the stock market it is likely to assume that
there were many events which directly refers to a dramatic change in a stock exchange prices
and their fluctuations such as: the Great Crush in 1929, The Tonic’s Boom of the early 1960s,
The Go-Go Years of the late 1960s, The Nifty Fifty bubble of the early 1970s, and the Black
Monday crash of October 1987, Mortgage Crash in 2008 (Baker & Wurgler, 2006). (See
chapter 1.1)
Question6:
Why changes in taxes and fiscal policies have to be considered during decision to invest in
capital markets?
Answer 6:
Respondent 1: Many investors have different opinions about this question but figures given
by one respondent have the most valuable information. This participant said that each
investor makes investment by current tax rates and calculation of profit is based on those

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rates. If in a mid-time taxes and taxes polices changes also profit might vary up or down
according this changes. If taxes goes down profit increases and opposite.
Respondent 2: It is obvious think that tax policies and fiscal policies have to be measured in
order to make profits. Every business depends on government policies in country where
business operates, therefore investment as a business is also affected. Investors have also to
consider government policies of other countries (tax and fiscal policy) if making an
investment in foreign country.
Overall view of other respondents: Other respondents agreed with this statement but also
added that it is important to follow other political changes that can challenge changes in
taxation. There were no exact facts stated from participants that are the most affecting
changes in taxation. Anyway, everything stated from primary and secondary research gives
us information that, if possible, every investment should be placed with huge respect on taxes
and fiscal policies and calculation of profits should expect small changes during the time.
Chapter (2.8.3.) from literature review also review findings regarding taxations and their
impact on investment. It clearly agreed that taxes and tax policies are the most frequent stated
problem regarding investor’s behaviour. The effectiveness of tax policy in altering
investment behaviour is an article of faith among both policy makers and economists.
Different simulative packages have been a greatest way in economic policy to satisfy
investors. Use of policy instruments where in direction of more general, all sorts of
liberalised depreciation schemes, investment allowance, and tax exemptions in developed
countries (Robert E. Hall and Dale W. Jorgensen, 2006).
Question 7:
Is there any reaction in prices in stock markets during political instability in a country and
worldwide?
Answer 7:
Respondent 1: There is always reaction in stock market prices during political instability in a
country and worldwide. This participant also gave an example from recent history when
changes in oil prices on a stock market during problems in Egypt and Russian-Ukrainian
problem.

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Respondent 2: Prices in stock market are changing during political instability worldwide. It
depends on occasions and geopolitical position, but changes are necessarily. We had
reactions in Europe with Swiss and Euro currencies which immediately made an impact on
other currencies and commodities.
Overall view of other respondents: All of 8 respondents agreed that are immediate changes
in market prices during political instability and gave a suggestion to review previous
occasions such as Egypt crises and USA FED reactions on a stock exchange that resulted
with changes in prices.
According to growing body of literature review recognised the importance of political
instability that may have a big impact on investor’s decision making process. The latter, by
increasing the probability of coups, revolutions, mass violence or, more generally, by
increasing policy uncertainty and threatening property rights, has a negative effect on
investment and, as a consequence, reduces growth (see chapter 2.10.), (Stasavage, D. 2002).
Question 8:
What kind of economic events you follow in order to decide whether to invest-that can
change stock prices direction?
Answer 8:
Respondent 1: Answer has stated that there are many events that investors are following. It
depends on which specific market you are involved in: a commodity, currencies, indexes-
therefore investor decide which are the most important for his decisions to make effective
investment decision.
Respondent 2: As an investor in capital markets, the main focus of my fundamental analyses
is based on statement from IMF and Fed US. Their statement about certain reaction on
economic growth can instantly affect prices on stock markets.
Overall view of other respondents: it is general idea that different events affect different
kind of markets. It has been also figured out that there are events that in general can affect all
stock markets prices, also company prices (shares prices).
Findings gathered in literature review in chapter 2.11 pointed out that those events that affect
stock market prices are important for bringing a right investment decision by following

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fundamental requirement for any event available of at least one listed financial instrument
that tracks the value of firms and values of macroeconomic condition. Identifying those
events is from huge interest for making effective investment decision, as well as, identifying
the information prior to the events. This is also called speculation on the content of an
announcement before it is made; or take time to adopt information and then react to it
(Beverley, L. 2008).
Question 9:
Is there any government support during recession that could help you to continue investing in
stock exchange?
Answer 9:
Respondent 1: government usually makes support packages that can support economy in
general. Based on that results investor should make a decision whether to invest or not. It is
likely to see market reaction state after government reaction. But there is not direct support to
investors, economy growth gives us a figures.
Overall view of other respondents: Primary research done with chosen population for this
research point out exactly the same figures as respondent 3 stated. Governments support
economy growth, there is a place where investors are looking for the chance to find
opportunity to make effective decision for good and profitable investment.

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Chapter 5
Conclusion and Recommendations
5.0. Introduction
This research project is done in a way to find out and explain factors important for evaluation
of decision making process of new investment in stock exchange for effective investment.
During time of 12 weeks, researcher have found many misunderstandings that are present in
everyday activities whose explanation and evaluation is believed can improve investors
activities on a daily basis and longer. Secondary data collected in this period have been
analysed in order to create foundation of information, crating clear picture for researcher that
helped in further investigation of problems. In addition to this, creation of interview and
discussion with 8 participants who shared their experience helped this research project to
achieve objectives and present findings that are aimed to help new investors in making
decision for effective investment.
Secondary data have been collected from documentation and articles already established
before this research project. Findings that showed history of investment environment and
factors that are affecting investors in their decision making process have been submitted and
analysed. After careful consideration of these findings, research methodology where
important to set up researcher plan how to be able to gather primary data from participants.
Presentation and recommendations produced from these findings are aimed to accomplish
objectives and fill up gaps stated from title of research project.
As research was going further, on its way researcher realised that findings are important
equally for new investors and experienced investors. Research was based to find out answers
and to reach objectives, but also is helpful for experienced investors to realise their mistakes
in the past and helpfully pay more attention according to research findings in the future.
5.1. Conclusion / Summary
Regarding task of this research project “Evaluation of Decision Making Process of new
Investment in Stock Exchange for Effective Investment”, researcher created objectives whose
explanation and evaluation will create recommendations that are helpful for investors to make
right decisions at right time. According to aim of research, researcher believed that great job

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is done and recommendations will improve further investors activities in order to make them
more effective and profitable.
1:
It is comprehend from the research that decision making process plays a vital role in order to
make effective investment. According to data collected from previous established documents,
books and articles, general understanding is, that decision making process have to pass
through many different stages before final decision is conducted.
As analysed trough literature review and agreed with primary data collected that final
decision presents output of set of information directly involved in business operations at a
given time. Every information is considered by different managerial levels, analysed and
conducted to senior managers who are responsible for a further treatment regarding received
information in order to make a final decision about coming investment opportunity.
Reach amount of data collected and analysed trough this research discovered that successful
decision must survive many difficulties and hazards of the environment. On its way to
critically analyse decision making process in order to bring new investment opportunity in
investing in stock exchange, as an objective of this research, this research have found an
important part in decision making process as its adoption. It is hard, but important, to make a
decision, but it wouldn’t be productive if other members or employees don’t accept such a
decision or decision find difficulties do be adopted and progressed. Findings suggested that
decision adoption is usually easy on-going part, but part without any decision wouldn’t make
a sense.
Summarising data also suggested that fundamental, technical and administrative support in
decision making process is equally important as decision making process itself. Without
fundamental, technical and administrative support, existence of decision making process will
face enormous amount of difficulties.
2:
It is concluded that there are many factors that can affect decision making process for
effective investment opportunity. As growing literature presents factors that have big impact
in decision making process, this research was intensively focused to discover and critically
analyse the most valuable and factors that in general every investor should be aware.

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Luck of research was that respondent’s trough research strongly agreed that factors listed
from secondary data collected in section 2 literature reviews, also practically take an
important place in investment environment. It is highly accepted that macroeconomic factors,
political uncertainty, changes in government policies and taxation are the most important
factors regarding findings trough literature review conformed by data collected from
experienced investors from practical view.
Aimed to identify and evaluate factors those are affecting decision making process in
effective investment in stock exchange, research findings stated above the most important
factors, but less important as fiscal policy, different stock market events in many ways can be
listed with same important factors.
General understanding describes that this factors are significant for stock market events and
road condition lead to stock market prices disturbance. Conducting them as stock market
events, prices are likely to change and very often unexpectedly surprise investors.
According to historical data summarised in background of this research, conclusion agreed as
well as, in primary data collection, that such market events make unpredictable movements
which stays dip engraved in investors mind (see chapter 1.1 and Q5). No matter how careful
investors are, it seems impossible to make a right decision for effective investment during
that period.
Technically, decision making process for effective investment apparently require modest
style, but the comfort violate analysed factors that after all deserves a lot of attention in
Decision Making Process of new Investment in Stock Exchange for Effective Investment.
3:
It is find out that decision making process for effective investment depends on factors that
can affect investment environment and stock prices. It has been also proved from literature
review and also submitted as a result of practical view from respondents that decision is
usually made by senior (experienced) managers. Findings also showed that adoption of
decision also plays important part towards final investment.
According to findings, as a final step, this research have been focused to explain and evaluate
measurement of decision making process in this field of business operations heading to

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conclude whole process and present findings in order to close the operational circle to meet
requirements from 3th objective of this research (see chapter 1.3.).
Firstly, in order to answer rising question “where” to invest, it is concluded that every
investor supposed to operate and invest in a sector of stock market which suits him the most.
Once investor feels confidence to invest in chosen stocks or shares, with strong awareness on
factors that have an impact on that stock, other measurements are coming as followed.
As explained in chapter 2.10., 2.11., 2.12. 2.13., and evaluated trough questions Q3, Q4, it
seems interesting to assume that other activities becoming more generalised and voluntary.
Those activities come out as a result of previous information analyses, managerial treatment
and senior managers’ filtration to bring final decision for effective investment.
On the other hand, effective investment wouldn’t be effective if investors don’t know “how”
long to keep that investment running up. Findings in research defined that time for
investment clearly depends the available resources and stock markets events (factors).
According to primary and secondary data collected, great attention is required as necessary
that the role of good decision “where” and “how” to invest will maximise profits and award
decision making process with effective investment progression.
Seemingly, misunderstandings in investment business and operation will be passed by
advantages of research findings. Evaluation of research questions discourages disadvantages
in accordance with aim of research, giving newly investors tailwinds to make their decisions
uninspired properly with full respect to the relevant facts.
Recommendations
Recommendations 1:
Regarding findings from primary and secondary research by virtue of their presentation,
researcher is proud to offer some recommendations hoping to complement misunderstanding
and totalize operational circle for future decision making process for effective investment.
Firstly, it is important for investor to choose stock market that he feels is the most convenient
for him to operate. Positioning accordingly to suitable stock market field automatically routes
investor to deal with the information closely related to the chosen market. This is highly

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recommended as a finding of research, therefore investor will have more opportunities to
conduct information through fundamental process and prepare for further actions.
Recommendations 2:
It is obviously that decision making process takes the most important part towards effective
investment. Each investor should take under consideration information which is closely
linked with stock exchange events and movements in a field of investor operations.
In accordance to findings, treatment of information may present factor that can affect
investment, therefor investor should pay a great attention to them and consider every
managerial interpretation of the same, before bringing final decision.
Recommendations 3:
Bringing a decision after careful consideration of above statement is particularly completed.
Recommendation of this research suggests that every decision have to be adapted to
investment environment, indicating that the investor has to get used to but that felt able to
implement that decision in further operations.
Recommendations 4:
Discovery also suggested that this research have to recommend certain information
concerning supportive sectors in investment operations. Fundamental support is greatly
important and through the work of its importance explained occupying the first position in the
operational chain.
Not only that they are equally important, but investors have to fully respect technical and
administrative support from other employees within organisation on the path of successful
investing.
Recommendations 5:
And if many opinions indicate that senior managers’ level is responsible to making decisions
for effective investment, researcher will kindly recommend that it is of great importance vital
that young investors follow the path in filling out the ambiguities and bring themselves up to
confidence to participate and parry in decision making process for effective investment.
Recommendations 5:

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Knowing that factors play an important role in investment environment, the investor should
take into account all factors, but a serious commitment to leave for factors that are closely
linked with selected market in which him/her invest.
Recommendations 6:
Even if deficiencies indicate that the current question is “where” and “how” to invest, this
project will recommend steps for measurement of investment.
Following the decision that the time is to invest in selected market or shares, determination of
the time and funds for that investment comes into force. This project is finding that every
investor needs to weigh its options or investing accordingly to company resources available
for every investment at specific time. This project is also recommended that time and market
chosen for investment should be carefully measured in order to maximize profits.
Recommendations 6:
According to findings from experienced investors and analysing market events in accordance
to market events and movements, it is highly recommended that if investor notices
unpredictable changes in stock market prices, the best choice is to step out and take a breath.
Every investor interviewed trough this project have experienced big movements in prices at
least once in his career history. They strongly recommend that if an investor can’t sense
market movements and have difficulties to bring decision; the best decision is to back down
and viewed from the side.
Recommendations 7:
It is obvious that government policies and taxation have impact in profits; therefore
suggestion as a finding of this research is to calculate profits for the long term and short term
and then bring decision regarding investment.
Recommendations 8:
It is more important to make significant profit than make an investment chasing big profits
and risking staying without any. Analyses of factors, measurements, decisions and all the
support in investment companies is based to make a profit, therefore investors should respect
all the support given to them in order to make stable and constant profits, rather than highly
profitable but also highly risky.

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5.2. Future Research
While this study represents an initial attempt to provide insights on the decision making
process for effective investment more research is required to broaden knowledge base on
decision making process in investment environment. This research encourages researchers to
conduct similar studies by applying suitable methods. Precisely because of same deficiencies
mentioned earlier suggestion is to use methodologies, which allow examining investor
decision making process in real time.
This may include research focusing on the importance of specific criteria such as studies
solely examining decision making process in same field of businesses. Increasing availability
of data will allow studies empirically examining factors affecting success of decision making
process in investment. Empirical studies will be a valuable complements to studies based on
quantitative and qualitative methods, which inevitably suffer from different basis.
Another open question is to extent does decision making process helps to avoid in advance
factors that affect effective investment? Initially, this research provides were focusing to
develop decision making process for effective investment and satisfying needs of
organisations in that way to achieve their goals. At present time researcher start to realize that
current question for latest-stage investors is possibility to avoid losses in future investment,
analysing factors and probably discard any possibility of possible poor investment decision.
Therefore, interests for future research have to be taken under consideration of existing
results as foundation for discovering answer for future research.

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Chapter 6
Personal Development Plan
6.0. Introduction
This final chapter provides a personal development that has been made over the course of
undertaking Master of Business and Administration and during the dissertation period. This
section outline the main academic and professional skills acquired during the completion of
MBA programme and how the learning helped to improve skills that have added value to the
researcher in future employment.
It also attempts to discover how the researcher become more skilled and configured its own
internal reflective arguments. The further expression helps to expose the growth and
development during the preliminary study and how this evolution has been useful for
currying on his professional career.
6.1. Learning from Master of Business Administration
It is no coincidences to having chosen attend to a MBA at University of Sunderland London
Campus. Since I finished Banking and Accounting in 2009 and PGD in Management and
Leadership, as a young person involved in trading and investments, I realised that I really
needed to improve my academic career. Completing an MBA will provide me with important
competitive advantages in a global investment environment, working with different kind of
backgrounds and cultures worldwide, besides obtaining a new business perspective away
from my home in Serbia.
My main expectations of this programme have been the acquisition of relevant expert
information in international investment and trade, and the opportunity to specialise in the area
of knowledge of my choosing, investment in stock markets. I was also wondering to learn
from others the different ways of doing things and know people with diverse culture and
ethnic backgrounds.
Achieving the award of MBA will help me entering into professional world, having more
opportunities to apply for a selection process of certain job. This MBA will give me more
chances to access in better conditions to labour market.

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This program provided a more comprehensive and interactive view to establish the link
between theory and practice, and a firm commitment to the own continuous evaluation and
student contribution. It also helps the researcher to learn through reflection on experience and
practice.
After doing the dissertation I am able to analyse business and information regarding
investment environment and factors that affect same, with more focus and formulate theories
based on gathering data, present the theories in a better way to an audience and beck them up
with relevant and rational facts. The biggest issue during this work was to accumulate
secondary data for the literature review, and configure a relevant amount of arguments on the
decision-making process for effective investment. But I overcome this by liveable through it
with patience. This is an example of how dissertation process made me learn the skills to
proceed with every section.
The MBA has provided the researcher with gaining fluency in English, the expertise and
knowledge acquired, accompanied by presentation skills and interaction will help me to find
more easily a better position when looking for a job. Some of the benefits to be a part of this
program have been the accessibility to look at situations in a more rational way by applying
various theories and capable of succeeding in areas which I would have considered in the past
to be a weakness. It has also helped me improving communication skills through gathering
primary data collection and doing interviews with participants.
The researched have found and maintained the openness of mind and his new capacity of
adoption and reaction. The academic knowledge and international expansion gained the
ground to a more tolerant and interactive person.
Assuming that dissertation was a very time consuming and demanding work in any stage of
the development, it was very interesting to undertake it. This research was unique opportunity
for the researcher to improve on decision-making process in investment environment and also
sense it from the view of reality. Living a life in another country and gathering this kind of
experience during time of doing research and producing dissertation was the best opinion that
could have happened to the researcher.

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Appendix 1
Permission Letter for Data Collection
To
The Manager
Barclays Capital Bank, Investment Department
And to
CEO Trader Cast, London Office, Investment Department
United Kingdom
Sub: Request to conduct interview
Dear Sir,
My name is Milos Stanojevic and currently studying a MBA at University of Sunderland-
London Campus (Canary Warf). The research I am aiming to conduct for my master’s degree
is based in case study of Barclays Capital Bank (investment division),as topic of research is
“Evaluation of Decision Making Process of new Investment in Stock Exchange for
Effective Investment”: a case study on Barclays Bank. The project has been done under the
supervision of Dr. Tahir Javed (University of Sunderland).
I an hereby seeking for your cooperation and permission to allow me to do research and
collect some valuable data which will help me in my research. If you require any further
information please don’t hesitate to contact me on 07805180456 or my E-mail
stanojevicmilos84@yahoo.com. Thank you for your time and consideration in this matter.
Thank you,
Kind regards
Stanojevic Milos

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Appendix 2
Qualitative Questionnaire
Interview
Question 1:
What is importance of decision making process for new investment in stock exchange?
Question 2:
Do you bring decisions to invest by yourself or decision is brought by management level
including more than one manager?
Question 3:
How much impacts have adopting of new strategic decision in investment environment?
Question 4:
How much measurements of decision making process can affect new effective investment
regarding time, funds, and human resources involved in such actions?
Question 5:
Which factors can affect effective investment decisions and have huge impact that you
experienced in past few years involved in this business?
Question6:
Why changes in taxes and fiscal policies have to be considered during decision to invest in
capital markets?
Question 7:
Is there any reaction in prices in stock markets during political instability in a country and
worldwide?

70. Page | 70
Question 8:
What kind of economic events you follow in order to decide whether to invest-that can
change stock prices direction?
Question 9:
Is there any government support during recession that could help you to continue investing in
stock exchange?