Portfolio Optimization, Risk Management and Professional Bias: An Empirical Analysisof The Indian Stock Market

Abstract

 ACKGROUND OF THE RESEARCH
With the changing aspirations of the middle income group, there is a quiet revolution taking place in savings and investment patterns among Indian
investors. The slow and steady flow of funds from the traditional investment avenues, such as fixed deposits, real estate, gold and precious metals to other classes of assets, such as mutual funds, stocks and bonds is becoming a reality. Physical assets such as land and gold, which used to be the dominant assets in an Indian family's portfolio, have seen a downtrend from 16.3 of the savings percent in FY 2012 to 10.6 percent in FY 2018. The household savings as a ratio of GDP has fallen from 34.6 percent in FY 2012 to 30.5 percent in FY 2018 (Mohanty, 2019). Yet, the investments in the mutual funds under the systematic investment schemes continue to grow from Rs. 67,190 in FY 2017-2018 to Rs. 1,00,084 in FY 2019-2020. The investors are willing to make investments rather than saving any amount above their consumption level