The objectives of the study are to determine the psychological factors which play an important role behind the
individual investors’ bias, in order to understand the influences of the individual investors’ bias, which can help the individual investors to avoid pitfalls while making investment decisions, and to create a literature on the research field of neurofinance.
Investors’ bias plays an important role in investment decision making because the bias is the combination of emotional and psychological factors which make the investor not to rely on the available information which certainly leads the investor to the irrational manner towards the investment decision making. Finance also looks at the investors and notes that they are not behaving according to the theories like prospect theory. A new trend in the finance, which is certainly in an embryonic stage and is termed as“Neurofinance”.
Neurofinance is the mixture of finance, psychology and neurosciences. Neurofinance uses the insights of psychology such as knowledge about the bias to understand and possibly correct mistakes committed by the individual investor towards their investment decision making. It tries to make sense of the facts on the investors’ bias towards investment decision making which indeed makes them behave irrational towards investment decision making.
Table of Contents
- CHAPTER-I
- INTRODUCTION
- CHAPTER-II
- INDUSTRY PROFILE.
- COMPANY PROFILE
- CHAPTER-III
- REVIEW OF LITERATURE
- CHAPTER-IV
- DATA ANALYSIS..
- AND...........
- DATA INTERPRETATION
- CHAPTER-V
- FINDINGS, SUGESSTIONS AND CONCLUSIONS..
- BIBLOGRAPHY
Objectives and Key Themes
This study aims to investigate the psychological factors influencing individual investors' biases in investment decision-making, exploring how these biases impact their choices and lead to potentially irrational decisions. The study utilizes the concept of Neurofinance, a relatively new field combining insights from psychology, finance, and neuroscience, to understand and potentially correct investment decisions made by individual investors.
- Understanding the role of individual investor biases in investment decision-making.
- Exploring the impact of specific biases, such as confirmatory bias, overconfident bias, home bias, availability bias, and myopic loss aversion bias.
- Introducing the field of Neurofinance and its application in mitigating investor biases.
- Examining how the insights of Neurofinance can improve investment decisions by providing a deeper understanding of investor behavior.
- Providing valuable insights for investment advisory services to better understand their clients' investment behavior.
Chapter Summaries
- Chapter I: Introduction
- Chapter II: Industry Profile & Company Profile
- Chapter III: Review of Literature
- Chapter IV: Data Analysis & Data Interpretation
This chapter introduces the study by providing a comprehensive overview of investment decisions and their importance. It defines investment and highlights the critical role of investment decisions in individuals' financial well-being. The chapter then focuses on the concept of bias, its influence on decision-making, and the need to understand and address it. It introduces Neurofinance as a promising approach to understanding and mitigating investor biases.
This chapter delves into the specific industry and company context of the study, providing relevant background information and market insights. It will likely analyze industry trends, competitive landscape, and the company's financial performance, setting the stage for the subsequent chapters.
This chapter critically examines the existing literature on investor biases and Neurofinance. It explores previous studies, findings, and theoretical frameworks relevant to the study's focus. This chapter aims to provide a comprehensive foundation for the study's research and analysis.
This chapter focuses on the quantitative and qualitative analysis of data collected for the study. It will likely involve the application of statistical techniques, data visualization, and other analytical methods to extract insights and identify patterns related to individual investor biases. The interpretation of these findings will be central to the study's conclusions.
Keywords
This study focuses on the key concepts of individual investor biases, Neurofinance, investment decision-making, psychological factors, and irrational behavior. The study will investigate specific biases such as confirmatory bias, overconfident bias, home bias, availability bias, and myopic loss aversion bias. It will examine the potential of Neurofinance to enhance investor awareness and improve decision-making processes.
- Quote paper
- Vara Lakshmi Thavva (Author), 2020, A Study on Individual Investors' Bias towards Investment Decision Making through the Concept of Neurofinance in NSIC Ltd., Munich, GRIN Verlag, https://www.grin.com/document/1034592
