PRESENTED BY: ANKESH GORKHALI

A PERCEPTION OF AN INDIVIDUAL EQUTIY INVESTOR

Introduction on Perception of Individual equity investor

Investors commonly perform investment decision by making use of fundamental analysis technical analysis and judgment.

It is assumed that information structure and the factors in the market systematically influence individuals investment decisions as well as market outcomes.

Individual Equity Investor makes market behavior derives from psychological principles of decision making to explain why people buy or sell stocks. These factors will focus upon how investors interpret and act on information to make investment decisions.

Attributes of Investment Anticipation of return: Return is the reward from

investment. It is awarded in future by bearing some level of risk.

Involvement of Risk: Risk exists in every investment alternatives. Investment made at present and it’s obviously certain, however, return is expected at future and it is uncertain.

Time Dimension: Time is another important factor for investment. It is inseparable attributes of investment . Time factor is utilized by investor using buy-and-hold.

Investment Environment The investment environment refers to all

internal and external factors affecting investment decisions of investors.

It includes all kinds of marketable securities that they are bought and sold through the brokers and financial intermediaries.

For examples; securities, security markets, financial intermediaries

Factors To Be Considered While Making An Investment Decision The major factor that should be considered in making investment decisions

includes the following.

Investment objective: Clear idea of investment objective facilities the investor to select appropriate securities for investment.

Rate of return: When selecting investment alternatives, an investor should always estimate the expected rate of return of the alternatives under consideration.

Risk: Risk can be defined as the variability of possible returns around the expected return on investment.

Taxes: The government taxes most source of income received by individuals, the tax consequences must be considered . Investor should always considered the tax provisions before choosing the alternatives for investment.

Factors To Be Considered While Making An Investment Decision

Investment Horizon: The nature and types of investment alternatives to be selected depend on the investment horizon.

Investment Strategies: An investor always needs to consider strategies dealing with selection, timing and diversification.

Objective: To find out the profit out of investment To minimize the risk To make the correct decision for investment To find out the possibilities of outcome after the

investment

Scope: Opportunity to get more returns on investment. Potential for great investment return. Helps to take decision on making investment smaller or large

sums of money. Investment managers can monitor the markets to avoid

dramatic losses . It makes easy to specify the type of company in which you

wish to invest.

Limitation:

No guarantee of returns Potential loss of capital. long-term investment prevents early withdrawals. Reliance on aptitude of investment manager to make profit. Hidden costs and work involved, e.g. when purchasing a

property. Economic crises or market problems may reduce value of

investment.

Reference: google.com