Impact of Anchoring, Herding and Loss-Aversion on Working Women’s Investment Decision-Making

Abstract

The area of behavioral finance integrates economic and psychological concepts to comprehend and elucidate the decision-making process involved in personal finance. The purpose of this paper is to determine the impact of anchoring, herding, and loss aversion on influencing working women investors’ investment decision-making. The sample size consists of 196 working women investors who are trading in the Indian Stock Market from Uttar Pradesh, India. A structured questionnaire is used for the collection of data, which is based on a five-point Likert scale. The SPSS (Version 22) software is used to analyze data employing the linear regression function. The result of this study confirmed that anchoring, herding, and loss aversion bias have a significant positive impact on working women investors’ investment decision-making. Based on the data obtained, this paper concludes that anchoring has the most influence on working women investors’ investment decisions, followed by herding, while loss aversion has the least influence on working women investors’ investment decision-making. The findings of this study have significant implications for working women investors, researchers, policymakers, and financial advisors. Awareness of these behavioral biases is vital for empowering working women to make informed and rational investment choices. It is important for financial advisors and policymakers to acknowledge these behavioral biases in order to offer customized counselling and support for working women investors. Even though these biases affect people of both genders equally, this research concentrates on how they particularly affect working women since they frequently deal with particular socio-cultural settings and expectations.

Keywords

• anchoring
• herding
• loss-aversion
• investment decision-making
• working women investors
• indian stock market