Escolar Documentos
Profissional Documentos
Cultura Documentos
INTRODUCTION:
All over the world have seen financial markets are more volatile over the years. Traditionally,
asset returns were measured based on the fundamentals, forecasting ability and market consensus
which produced prevalent results and this information influences the performance of the asset in
stock market. Due to this fact investor possible returns of stock and received returns differ, to
avoid this problem and to improve the quality of investment decisions of investors, behavioural
economists identify the importance of psychological biases on investment decision-making the
process of the investor.
Different research studies provided evidence that behavioural biases and anomalies affect the
investment strategy of investors in financial markets. Behavioural biases and anomalies
contribute more when making investment decision-making process of investors. Among all of
the havioural biases, herding behaviour is one of the most common behaviours found in the
investors while understanding their psychology.
Stock market is an important part of the economy of a country. the stock market plays a play a
pivotal role in the growth of the industry and commence of the country the eventually affects the
economy of the country to great event, that is reason that the government industry and even the
central bank of the country keep a close watch on the happenings of the stock market.
Due to the positive correlation between stock market and economy, the rise of stock market will
positively affect the development of the economy and vice versa. Thus, the decisions of
investors on stock market play an important role in defining the market trend, which then
influences the economy. To understand and give some suitable explanation for the investors’
decisions, it is important to explore which behavioural factors influence the decisions of
individual investors at the Indian Stock Exchange.
The database provides information regarding the daily opening, high, low, and close values of
the SENSEX and NATEX and BSE200 indices among other indices. The research is conducted
for Nifty 50 index & Nifty 50 stocks. It is based on the daily closing price of the trading sessions
for the period of 5 years that is from 1st April 2013 to 31st March 2018.