Investigating the Factors that Affect Goal-Based Investing Behaviour: An Empirical Study

Abstract

This research study investigates the factors that influence goal-based investing behaviour among Indian investors and measures their impact on herding behaviour and disposition effect. The study considers financial goals, risk tolerance, financial literacy, investment knowledge, and investment attitude as independent variables. Data was collected from 80 Indian respondents of various age groups. The study hypothesizes that herding behaviour and disposition effects are significantly influenced by financial goals, investment knowledge, investment attitudes, risk tolerance, and financial literacy. The results indicate that all independent variables have a significant effect on herding behaviour, while only financial goals, investment knowledge, and investment attitudes have a significant effect on the disposition effect. The study provides valuable insights for investors, financial advisors, and policymakers to improve goal-based investing behaviour among Indian investors. By focusing on setting clear financial goals, increasing investment knowledge, developing a positive investment attitude, and promoting financial literacy, investors can improve their investment behaviour and achieve their financial objectives.