Kirtana 0386 Investment

Investm
ent
behavio
r
of
Women
Investor
s
Investment Behaviour of Women

Investors
A dissertation submitted in partial fulfillment of the
requirement of Post Graduate Degree
in Master of Business Administration of
Bangalore University
Submitted by:
KIRTANA
KAULIGE
Register no. :
03XQCM6048
UNDER THE GUIDANCE

OF
Dr
Nagesh
S
Mallavalli
2004 2005
MP Birla Institute of
Management
Associate
Bhavan
Bharatiya
Vidya
BANGAL ORE 560

001.
M. P.Birla Institute of Management, Associate B hartiya

Vidya Bhavan
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DECLA
RATION
I hereby declare that this research work
embodied in this entitled dissertation
Investment Behavior of Women Investors
has been carried out by me, under
the guidance of Dr.Nagesh .S. Mallavalli,
Principal, MPBIM, Bangalore

I also declare that this dissertation has not
been submitted to any University or
Institution for the award of any Degree or
diploma.
PLACE: Bangalore
DATE:
(Kirtana N Kaulige)
M. P.Birla Institute of Management, Associate

B hartiya Vidya Bhavan
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ACKNOWL
EDGEMENT
I am grateful to many people whose timely
help and guidance has helped me to
conduct this research successfully.
I hereby wish to express my heart felt
gratitude to Dr. Nagesh S Mallavalli,
Principal for his guidance and supervision.

Finally I would like to extend my grateful
thanks to all my friends and faculty
members of MPBIM, Bangalore whose
assistance has a lot to me personally
for the completion of this research.
PLACE: Bangalore
DATE:
(Kirtana N Kaulige)

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RESEARCH
EXTRACT
Womens position in society has been changing
over the last few decades. Today women are
better educated and earn more money than
before, which has increased womens influence
on financial decision in families. The interest in
investing has been increasing while the
households have become more prosperous. The

results showed that the investors age,
financial situation, attitude towards risks and the
phase of life affect investment behavior.
This research is carried out primarily t o find out
the attitude of women investors towards the
risk and return and the process of financial
planning process undertaken by these investors.
This research also provides an insight into the
needs and wants of women investors with
respect to the kind of portfolio of investment they
are looking for and understand their
financial requirements in life.
As this research is also provides the information
about the financial planning process of
women investors it becomes extremely essential
to understand the process as a whole.
Financial planning is the process of meeting
goals of life through proper management of
finances of an individual. Financial planning
provides direction and meaning to financial
decisions. It helps in understanding how each
financial decision one makes affects other
areas of finances. By viewing each financial
decision as part of a whole, short and long-term
effects on the life goals can be evaluated.

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Topic
Investment Behavior and Financial Planning
Process of Women Investors.
Statement of the Problem
This research is carried out primarily to find out
the various options available to the women
investors whole doing their financial planning

and to find their attitude towards risk and
return.
Objectives of the study
This study foc use s on investment behavior of
women investors and the factors that influence
their investment decisions. An in depth analysis is
made in terms of their financial goals and
their investment patterns. It also focuses on the
various investment options women invest in
and how aggressive they are in terms of
investing.
Methodology and Data Collection
The Primary Data
was collected by
administering a detailed questionnaire and also
by
conducting in-depth personal interviews.
Secondary data was collected through various
sources such as magazines, internet,
business journals etc.
Findings
70% of the women have invested 10% to 20% of
their income followed by women.
Most of the women consisting of 60% of th em
take their own investment decision.
90% of the women dont have a formal financial
plan.
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38% of the women have ranked liquidity as the
most important consideration while
taking investment decisions.
70% of the women had the basic understanding
about investing and have made some
investments.
78% of the women prefer to invest in safer
investments.
54% of the women would transfer their money
into more secure sectors if their
investments decrease in value.
46% of the women base their decisions on the

advice of their family members. 38% of
the women base their decisions on the
advice of their friends.
58% of the women have a average tolerance
level.
Conclusion
It can be concluded that generally, women are
conservative investors and they feel that
safeguarding what they have is top priority. These
investors want to avoid risk
particularly the risk of losing an y principal that
is their original investment even if that
means theyll have to sett le for ver y modest
returns.

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1752'8&7
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INTROD
UCTION
BACKGROUND
As a woman, and an investor, shaping of
financial future is as important as the many ot her
roles they play in life. That's why takin g control

today is essential i n realizing their dreams
for tomorrow. Whether women are just beginning
to develop their investment strategy or are
refining a current one, it's important to keep in
mind that they should build a finan cial legacy
for long term. At various stages of your life, you
are faced with important investment and
financial decisions. Your success in making these
decisions with the help of a sound
investment strategy can have a major impact on
your income, net worth and, ultimately,
quality of life in retirement.
Women today ha ve more earnin g potential and
more influence over financial decisions than
ever before. Women represent almost half of the
workforce and many businesses are owned
or managed by women. Many women influence
or control the majority of all consumer
purchase decisions and many of the investment
decisions. As a result, it is important for
women to focus on finances now more than ever.
Throughout their lives, as a woman, they will be
faced with different financial challenges
than their male counterparts. If women are going
to take control of their financial future, its
important that they recognize those differences
and empower themselves.
Earning money is only half the equation for
achieving financial independence. Effectively
putting your money to work for you is equally
important. Though the size of household

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income matters, how to manage the money
women have to meet short-term obligations
as
well as long-term goals determines how they
live today and in the future. That's why
taking control of their finances is so important.
The challenges of investing are unique for
each individual. In addition, circumstances are
frequently different for women and
whatever choices you make will be better as a
result of greater knowledge of the underlying
issues and your options.
Women are more likely to live longer

As a woman; the life expectancy is at an all time
high. In fact, 90% of women eventually
end up living on their own. To help ensure that
women will be able to maintain their
lifestyle, they should stay involved in investment
decisions and consider planning for th e
unexpected early on.
Women are more likely to have dependents to
care for
With a growing divorce rate, the number of single
mothers is on the rise. Providing for and
raising a family, while also saving for college and
retirement, can be a daunting task. One
way to help ensure that you have enough savings
is to invest a small amount regularly
through a systematic investment plan.
Women are less likely t o take investment risks
For whatever reason; many women are less
willing than men to take risks. Yet, a certain
degree of risk is necessary to build a welldiversified portfolio. By learning all about
investing, women can become more comfortable
making investment decisions that involve
different levels of risk.
Financial Planning Process

For this purpose a thorough understanding of
financial planning is important for all
investors. Financial planning is the process of
meeting ones life goals through the proper

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management of his/her finances. Life goals can
include buying a home, saving for your
child's education or planning for retirement. The
financial planning process consists of six
steps that help people to take a "big picture" look
at where they are financially. Using these
six steps, women can work out where they are
now, what they may need in the future and
what they must do to reach their goals.
The process involves gathering relevant financial
information, setting life goals, examining
current financial status by women and coming up
with a strategy or plan for how they can

meet their goals given their current situation and
future plans.
Financial and personal satisfaction is the result of
an organized process that is commonly
referred to as personal money management or
personal financial planning.
Personal financial planning is the process of
managin g investors money to achieve
personal economic satisfaction. This planning
process allows him/her to control their
financial situation. Every person, family, or
household has a unique financial position, and
any financial activity therefore must also be
carefully planned to meet specific needs and
goals.
A comprehensive financial plan can enhance the
quality of life and increase investors
satisfaction by reducing uncertainty about your
future needs and resources. The specific
advantages of personal financial planning include
Increased effectiveness in obtaining,
using, and protecting your financial
resources
throughout the lifetime.

Increased control of the financial affairs
by avoiding excessive debt, bankruptcy,
and
dependence on others for economic

security.
Improved personal relationships resulting
from well-planned and effectively
communicated financial decisions.

A sense of freedom from financial
worries obtained by looking to the future,
anticipating expenses, and achieving the

personal economic goals.

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We all make hundreds of decisions each day.
Most of these decisions are quite simple and
have few consequences. Some are complex and
have long-term effects on our personal and
financial situations. The financial planning
process is a logical, six-step procedure:
Determining of current financial situation
Development of financial goals
Identifying alternative courses of action
Evaluating alternatives
Creating and implementing a financial

action plan, and
Evaluating and revising the plan.
Step 1: Determination of Current Financial

Situation
In this first step of the financial planning
process, investors will determine their
current financial situation with regard to

income, savings, living expenses, and
debts.
Preparing a list of current asset and debt
balances and amounts spent for various
items which give a foundation for
financial planning activities.
Step 2: Development of Financial Goals
Investors should periodically analyze
their financial values and goals. This
involves
identifying how they feel about money

and why they feel that way. The purpose
of
this analysis is to differentiate their needs
from their wants.
Specific financial goals are vital to
financial planning. Others can suggest
financial
goals for investors; however, they must

decide which goals to pursue. Their
financial
goals can range from spending all of their

current income to developing an
extensive
savings and investment program for their
future financial security.
Step 3: Identify Alternative Courses of Action
Developing alternatives is crucial for
making good decisions. Although many
factors
will influence the available alternatives,

possible courses of action usually fall into
these categories:
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Continue the same course of action.
Expand the current situation.
Change the current situation.
Take a new course of action.
Not all of these categories will apply to

ever y decision situation; however, they
do
represent possible courses of action.

Creativity in decision making is vital to
effective choices. Considering all of the
possible alternatives will help the investor

make more effective and satisfying
decisions.
Step 4: Evaluate Alternatives
Investors need to evaluate possible
courses
of
action,
taking
into
consideration life
situation, personal values, and current

economic conditions.
Consequences of Choices.
Every
decision closes off alternatives. For
example, a
decision to invest in stock may mean an

investor cannot take a vacation.
Opportunity cost is what investor gives
up by making a choice. This cost,
commonly referred to as the trade-off of a
decision, cannot always be measured.
Decision making will be an ongoing part
of personal and financial situation. Thus,
investor needs to consider the lost

opportunities that will result from their
decisions.
Evaluating Risk
Uncertainty is a part of every decision.
Selecting a college major and choosing a
career field involve risk.

Other decisions involve a very low degree
of risk, such as putting money in a

savings
account or purchasing items that cost ver

y less. The chances of losin g something
of
great value are low in these situations.
In many financial decisio ns, identifying
and evaluating risk is difficult. The best
way
to consider risk is to gather information

based on investors experience and the
experiences of others and to use financial
planning information sources.

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Financial Planning Information Sources
Relevant information is required at each
stage of the decision-making process.
Changing personal, social, and economic

conditions will require that investor
continually supplement and update your
knowledge.
Step 5: Create and Implement a Financial
Action Plan
In this step of the financial planning
process, investor will develop an action

plan.
This requires choosing ways to achieve

your goals. As he/she achieves their
immediate or short-term goals, the goals
next in priority will come into focus.
To implement the financial action plan,
investors may need assistance from
others.
For example, investor may use the

services of an insurance agent to purchase
property insurance or the services of an
investment broker to purchase stocks,
bonds,
or mutual funds.
Step 6: Reevaluate and Revise the Plan
Financial planning is a dynamic process
that does not end when investor takes a
particular action. They need to regularly

assess their financial decisions. Changing
personal, social, and economic factors
may require more frequent assessments.
When life events affect investors
financial needs, this financial planning
process
will provide a vehicle for adapting to

those changes. Regularly reviewing this
decision-making process will help them
to make priority adjustments that will
bring
their financial goals and activities in line
with their current life situation.
To achieve the best results from financial

planning engagement the following becomes
necessary for women investors:
Set measurable financial goals
Set specific targets of what women want to
achieve and when they want to achieve results.
For example, instead of saying you want to be
"comfortable" when you retire or that you

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want your children to attend "good" schools, you
need to quantify what "comfortable" and
"good" mean so that you'll know when you've
reached your goals.
Understand the effect of each financial
decision
Each financial decision women make can affect
several other areas of their life. For example
a decision about a womans child's education
may affect when and how she meets her
retirement goals. All the financial decisions are
interrelated.
Re-evaluation
of
financial
situation
periodically
Financial planning is a dynamic process.
Financial goals may change over the years due to
changes in your lifestyle or circumstances, such
as an inheritance, marriage, birth, house
purchase or change of job status. Revision of the
financial plan to reflect these changes
becomes necessary to stay on track with the longterm goals.
Start planning as early as possible
People who save or invest small amounts of
money early, and often, tend to do better than
those who wait until later in life. By dev eloping
go od financial planning habits such as
saving, budgeting, investing and regularly
reviewing finances by women early in their life
will help them to meet life changes and handle
emergencies.
Be realistic in your expectations.
Financial planning is a common sense approach
to managing finances to reach your life
goals. Events beyond a persons control such as
inflation or changes in the stock market or
interest rates will affect your financial planning
results.
The various factors which will influence a
women investor are:
Start early
The most important step in any long-term
investment plan is to start early. Even if women
are only able to set aside a small amount of
money monthly, or even quarterly, that money

should still grow and generate earnings over time.
One highly effective way to make investing a
habit is by pa ying you rself first. Setting aside

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a portion of income before paying other expenses
can ensure that women have the money
they need to stick to an investment plan.
Stay Ahead of Inflation
Day-to-day inflationary price increases are often
barely noticeable. Yet, over the lon g term,
a small increase in average yearly inflation can
add up to a serious drain on investors
buying power. Women should focus on educated
investment choices which may offset
inflation's daily climb.
Invest Routinely
The widely heard mantra of "buy low, sell high"
is something many investors strive for
but few achieve. Since n o one can really predict
the markets' ups and downs, even extensive
research and analysis can't guarantee you a "low"
price when you decide to invest.
Risk Tolerance
Risk is not something many people seek in their
daily lives, but when it comes to investing,
some degree of risk can be potentially rewarding.
The investments usually involve some
degree of risk. As a general rule of thumb, the
higher the risk associated with an investment,
the higher the potential return.
What is the best saving and investing products
should be ascertained. This depends on when
women will need the mo ney, their goals
For instance, if women are saving for retirement,
and they have 35 years before they retire,
they may want to consider riskier investment
products, knowing that if you stick to only the
"savings" products or to less risky investment
products, their money will grow too slowly
or given inflation or taxes, they may lose the
purchasing power of their money. A frequent
mistake people make is putting money they will
not need for a very long time in investments
that pay a low amount of interest.
On the other hand, if women are saving for a
short-term goal, five years or less, they don't
want to choose risky inv estments, because when
it's time to sell, they may have to take a

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loss. Since investments often move up and down
in value rapidly, they want to make sure
that they can wait and sell at the best possible
time.
The primary risks in fund investing include the
following:
Systematic Risk - A risk that influences a
large number of assets. An example is
political events. It is virtually impossible

to protect yourself against this type of
risk.
Unsystematic Risk - Sometimes referred to

as "specific risk". It's risk that affects a
very small number of assets. An example is
news that affects a specific stock such as
a sudden strike by employees.
Credit or Default Risk - This is the risk that
a company or individual will be unable
to pay the contractu al interest or principal on
its debt obligations. This type of risk is
of particular concern to investors who hold
bond's within their portfolio. Government
bonds, especially those issued by the Federal
government, have the least amount of
default risk and least amount of returns while
corporate bonds tend to have the
highest amount of default risk but also the
higher interest rates. Bonds with lower
chances of default are considered to be
investment grade, and bonds with higher
chances are considered to be junk bonds.
Bond rating services, such as Moody's,
allows investors to determine which bonds
are investment-grade, and which bonds
are junk.
Country Risk This refers to the risk that a
country won't be able to honor its
financial commitments. When a country
defaults it can harm the performance of all
other financial instruments in that country as
well as other countries it has relations
with. Countr y risk applies to stocks, bonds,

mutual funds, options and futur es that are
issued within a particular country. This type
of risk is most often seen in emerging
markets or countries that have a sev ere
deficit.
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markets or countries that have a sev ere
deficit.
Foreign Exchange Risk When investing
in foreign countries you must consider
the fact that currency exchange rates can
change the price of the asset as well.
Foreign exchange risk applies to all financial
instruments that are in a currency other
than your domestic currency. As an example,
if you are a resident of America and
invest in some Canadian stock in Canadian
dollars, even if the share value
appreciates, you may lose money if the

Canadian dollar depreciates in relation to the
American dollar.
Interest Rate Risk - A rise in interest rates
during the term of your debt securities
hurts the performance of stocks and bonds.
Political Risk - This represents the financial
risk that a countr y's government will
suddenly ch ange its policies. This is a major
reason that second and third world
countries lack foreign investment.
Market Risk - This is the most familiar of
all risks. It's the day to day fluctuations in
a stocks price. Also referred to as volatility.
Market risk applies mainly to stocks and
options. As a whole, stocks tend to perform
well during a bull market and poorly
during a bear market volatility is not so
much a cause but an effect of certain
market forces. Volatility is a measure of risk
because it refers to the behavior, or
temperament, of your investment rather
than the reason for this behavior. Because
market movement is the reason why people
can make money from stocks, volatility
is essential for returns, and the more unstable
the investment the more chance it can
go dramatically either way.
The risk/return tradeoff is the balance an investor
must decide on between the desires for the
lowest possible risk for the highest possible
returns. Remember to keep in mind that low
levels of uncertainty (low risk) are associated
with low potential returns and high levels of

uncertainty (high risk) are associated with high
potential returns.

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Diversif ication of the Assets
Limiting the investments to a single type or style
can be a potentially dangerous situation.
The success of investment strategy depends more
on the combination of asset classes
chosen, and less on the individual securities
themselves.
Diversifying the assets, or spreading them across
a variety of investment types and styles, is
a more effective way to manage portfolio's risk
level. Because different investments respond
differently to changing market conditions,
diversification may provide protection in the
event that one or more investments experience a

downturn.
Applying the concept of asset allocation helps
ensure that you adequately diversif y your
assets. Asset allocation means spreading your
money across different asset classes, such as
stocks, bonds and cash. Asset classes usually do
not move in tandem. Therefore, at any
given risk level, there is an allocation of stock;
bond and cash investments that may help you
realize your return potential while minimizing
your risk exposure.
Alleviate Tax Burdens
It sounds easy enough identify investments with
strong fundamentals and good growth
prospects, purchase the most promising, and sit
back and wait. This strategy, known as "buy
and hold" investing, is known to be a highly
effective way of riding out the markets' short term fluctuations. In contrast, some investors try
to time the market by anticipating the
markets' movements and investing accordingly.
While this may seem like a proactive way of
investing, pinpointing th e exact highs and lows
is a difficult thing to do even for investment
professionals.
Investment Alternatives
Today's investor is faced with an overwhelming
number of choices when it comes to
implementing an investment strategy. Since the
right combination of investments in the right
types of accounts can mean reaching your goals
sooner rather than later, it is important to
know your alternatives. Below is a list of the

major building blocks of any successful
strategy.
Stocks
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A share of stock represents partial ownership in a
company. Initially sold by the company
itself to raise money, the shares are then bought
and sold by investors in the secondary
market. Shareholders can vote on the company's
major decisions, and receive dividends as
their share of profits. As a company's stock price
rises or falls, so does the shareholder s'
investment.
Bonds
Like stocks, bonds are issued by companies and
governments to raise money to fund a
variety of projects and operations. Unlike stocks,

a bond is a loan that the issuer promises to
pay back, usually at a set interest rate. Bonds are
then bought and sold by investors in the
secondar y market.
Mutual Funds
One of the most convenient investment options
available, mutual funds offer investors the
benefits of professional management and
diversification. By pooling the assets of man y
investors, and pursuing a set investment
objective, mutual fund managers are able to
provide
investors with buying power unavailable to
individual investors.
Insurance and Annuities
Insurance and annuities can help you work
towards life's goals and plan for the une xpected.
Offering tax-deferred growth, the option of
income for life and a guaranteed death benefit,
annuities can be a way to supplement your 401(k)
or IRA retirement savings plan. An
annuity requires you to make one or a series of
payments and, if you choose, the insurance
company will pay you a regular stream of income
in the future in return. With life insurance,
you pay premiums to the insurance company
which entitle your beneficiaries to a specified
benefit payment should something happen to you
unexpectedly. This is all subject to the
paying ability of the issuing insurance company.
Cash and Cash Equivalents
Treasur y bills, money market mutual funds,
certificates of deposit, even passbook savings
accounts are all considered cash. Returns on these
types of savin gs and investments are
usually low because they often involve little or no

loss of principal. But as a relatively safe
place to keep funds that you may need to access
readily, they play an important role in any
investment plan.
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But women investors have to restrict their choice
of investment assets. These restrictions
arise from their specific circumstances.
Identifying these restrictions will affect their
investment policy. The investment decisions are
mainly affected by:
Liquidity
Liquidity is the ease with which an asset can be
sold and still fetch a fair price. Women
investors must consider how likely they a re to
dispose of the assets at short notice. From this
likelihood, they establish the minimum level of

liquid assets they want in the investment
portfolio.
Investment Horizon
This is the planned liquidation date of the
investment or part of it. It could be the time to
fund a childs education or marriage for women.
Horizon needs to be considered as the
women investors have to choose between assets
of various maturities.
Tax Considerations
Tax consequences are central to investment
decisions. The performance of an y investment
strategy is measured by how much it yields after
taxes. For women investors who face
significant tax rates, tax sheltering and deferral of
tax obligations may be pivotal in their
investment strategy.
Unique needs
Virtually every i nvestor faces special
circumstances. Primary i nvestment of an
individual
and the unique risk profile that results from
employment can play a big role in determining a
suitable investment portfolio for women. These
unique needs often center on a womans
stage in the life cycle. Retirement, housing and
childrens education and many other factors
demand for funds and investment policy will
depend in part on the prox imity of this
expenditure.

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Since this research has been conducted on the
women investors and a study of their
investment behavior, it becomes important to
divide them into different types. Women
Investors have their own investing styles: some
are risk takers by nature, willing to gamble
large amounts of money on highly speculative
investments. Others prefer the safety and
security of cash in the bank even if it means that
the actual buying power of their money is
slowly dwindling because of inflation. Most
people fall somewhere in between these
extremes, and are willing to assume some risk,
with the expectation that theyll be rewarded

with higher returns. The amount of risk youre
willing to take is your investing style.
The investing style stems from a variety of
things: age, personality, personal experience,
and financial circumstances to name a few. For
instance, if women are approaching
retirement, have many financial responsibilities,
or have lived through major recession,
chances are they may be a more risk-averse, or
conservative investor.
On the other hand, if youre young, earning a
high income, have few financial
responsibilities, and have seen little in the way of
economic hardship, you might be inclined
to take more risk.
Categories of Investors
While there are as many investing styles as there
are investors, most people fall more or less
into one of three broad categories: conservative,
moderate, aggressive.
Conservative investors
Generally, conservative investors feel that
safeguarding what they have is their top priority.
These investors want to avoid risk
particularly the risk of losing any
principal
(their
original investment) even if that means theyll
have to settle for very modest returns.
Conservative investors allocate most of their

portfolios to bonds, such as Treasur y notes or
high-rated municipal bonds, and cash
equivalents, such as CDs and money market
accounts.
Theyre generally reluctant to invest in stocks,
which may lose value, especially over the
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short term. When conservative investors do
venture into stocks theyre often inclined to
choose blue chips or other large-cap stocks with
well-known brands because they tend to
change value more slowly than other types of
stock and often pay dividend income.
Moderate investors
Moderate investors want to increase the value of
their portfolios while protecting th eir assets
from the risk of major losses.
For example, a moderate investor might use an

allocation model that has 60% in stock, 30%
in bonds, and 10% in cash equivalents . While
they will tend to favor blue chip and other
large-cap stocks, they may be willing to invest a
modest portion of their principal in higher
risk securities such as international stock,
small-caps, and volatile sector funds in
order to increase their potential for higher returns.
Even if women are not risk takers by natur e, a
moderate investing style may be suitable in
any circumstance or financial situation.
Aggressive investors
Aggressive investors concentrate on investments
that have the potential for significant
growth. They are willing to take the risk of losing
some of their principal, with the
expectation that they will realize greater returns.
Aggressive investors might allocate from 75 to
95% of their portfolios to individual stocks
and stock mutual funds. While large- and smallcap stocks and funds may make up the core
of their portfolios, many aggressive investors will
have significant holdings in more
speculative stocks and funds, such as emerging
market and sector mutual funds.
Since aggressive investors focus on growth, they
are usually less inclined to hold incomeproducing securities, such as bonds.
An aggressive investing style is definitely n ot for
the faint of heart. Its best suited for
investors with a long-term investing horizon of

15 years or more, who are willing to make a
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long-term commitment to the stocks they bu y.
But history has shown that an aggressive
investing approach, combined with a well
diversified portfolio, and the patience to stick to
a
long-term buy-and-hold investing strategy
through inevitable market downturns, can be the
most profitable in the long run.
Problem Statement
This research is carried out primarily to find out
the various options available to the women
investors whole doing their financial planning
and to find their attitude towards risk and
return .To find out the type of investment option
which are desirable to different kinds of
women investors.
Purpose of the Study

This research is conducted with a focus on the
investment behavior of the women investors
and factors they consider while taking investment
decisions. It also highlights the various
purposes for which the funds from the
investments done by the women will be used by
them.
Scope of the Study

The scope of the stud y is restricted to the market
survey conducted on women investors with
respect to the preference of various investment
options while doing their financial planning .
Research Question
What are the traits of womens investment
behavior?

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Objectives of the Study

Primary Objectives
To find out risk appetite of women investors.
To find out whether the women investors are
looking for long term growth or risk or
return or liquidity.
T
o
kno
w
thei
r
lon
g
ter
m
fina
nci
al
goa
ls.
Secondary Objectives
To understand the needs and wants of the resp
ondents with respect to their financial
requirements in their life.
To have an understanding of the respondents
saving pattern.

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5(9,
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REVIEW OF
LITERATURE
Financial investment is the purchase of a
financial security, such as a stock, bond, or
mortgage. Investment in human capital is

spending on education, training, health services,
and other activities that increase the productivity
of the workforce. It is the use of money for
the purpose of making more money, to gain
income, increase capital, or both. The
purchasing of stocks, bonds, mutual funds,
options, real estate, etc., made with the
expectation of future income or capital gains is
investment.
An article entitled When It Comes to
Investing, Is Gender a Strong Influence on
Behavior and a report given by Robert C.
Doll was reviewed to know the purpose,
objective and also the methodology used in their
report and the conclusions that he has
drawn. This process has helped in devising a
broad framework for the stud y and in
identifying those areas of study that the
researcher has not touched upon.
When It Comes to Investing, Is Gender a
Strong Influence on Behavior
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Background
In April 2004, Merrill Lynch Investment
Managers undertook a study of investors and
examined their related attitudes, beliefs and
knowledge levels. In gender terms, the survey
found that a little self-knowledge can go a lon g
way.
Participants had to be solely or jointly
responsible for financial and investment
decisions for
their household, and have at least $75,000 in
investable assets and an annual household

income of at least $75,000.
Objective of the Study

This survey brings a new perspective on the
attitudes, knowledge and emotions that inform
investor mistakes. Male or female, the point is
this: Understand the motivations and
emotions that inform their decision making and
that can make better, more profitable
investment decisions."
Purpose of the Study
According to a groundbreaking survey of
investors despite the fact that, on average, they
tend to know less about investing and enjoy
investing less than men. The purpose was to
understand the investment styles of both men and
women and the effect of money as an
emotional instrument which can get in the way of
making the right investment decisions.
Methodology
The nationwide telephone poll examined the
investment mistakes of 1,000 investors 500
men and 500 women and their related
attitudes, beliefs and knowledge levels. Overall
findings were analyzed looking specifically at
results by gender.
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The survey was done and random selection of
sample was collected. The data was presented
and summarized to get the pattern of
relationships between various characteristics such
as
respondents attitude, emotions etc.
Findings
While all investors make mistakes, the survey
found that women make fewer mistakes
than men. Women are f ar less likely than
men to hold a losing investment too long or
wait too long to sell a winning investment.

A significantly greater percentage of women
(47%) than men (30%) report not being
knowledgeable about investing.
Women take a very deliberate approach to their
finances. They are eager to identify
goals and look to build a partnership with
their financial advisor and want to be
actively
involved in the process of building and
executing a financial plan.
Both men and women cite the desire to have a
comfortable retirement as their primary
motivator, however, more women than men
cite this. More women also cite wanting to
be financially independent and having money
to spend on the things they as "very
important" motivators.
Women are more likely than men to fall into the
reluctant or unprepared categories
Investors in these categories tend to not
enjoying investing and are generally less
knowledgeable about investing.
Conclusion
Women's lesser knowledge and interest in
investing may explain why this catego ry skews
slightly female. Unpr epared investors are not
happy with their current financial situation.
They are the most likely to lack confidence and
be fearful or anxious about investing. They
are the least likely to rebalance their portfolios.
It's critical for investors to understand their
psychological makeup . Money is an emotional
instrument, but emotions can get in the way of
making the right investment decisions.

Behavioral scientists have tended to look at
investors as a whole, but both men and

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women alike are influenced by di fferent
emotions. If we can fathom our individual
emotional tendencies, then we can take steps to
anticipate and correct them."
Recommendations
Women should be encouraged to participate in
the investment avenues.
They should try to invest in securities which
have higher risks.
Women investors should achieve their su ccess
by starting early investment in life and
invest and rebalance regularly. These women

investors should not over-allocate to a
single investment.
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RESEARCH
METHODOLOG
Y
Type of research:
Descriptive Research
The type of research used in this study
i s descriptive. This has been used this
research
centers around the typically structured
investigative questions. In this case descriptions
of
characteristics associated with population of
women investors are formulated. Estimates of
the proportions of women who possess particular
investment behavior is evaluated. And
after this process association was made to
different aspects of the investment habits of
women and their appetite of risk and investment
styles of women is discovered.
Method of Data Collection

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a) Primary data
Primary data has been used in this study. Primary
data was collected by administering a
detailed questionnaire and also by conducting in
depth personal interviews.
b) Secondary Data
For this study secondary data was collected
through various sources such as magazines,
internet and business journals.
Survey
The communication approach involved surveying
women investors and recording their
responses for analysis. Questionnaires were given

to various women who are working to
evaluate their investment patterns and to know
their financial goals in life.
Sampling Design
Population
The population chosen for this study is women
who stay in Bangalore as the research
revolves around the investment habits and the
financial requirements of women investors.
Sample Size
For the purpose of this study, I have collected
data from 50 women respondents. This is the
true representative of the universe.
Sample Unit
In this research is conducted only for women.
Sampling Techniques
For the purpose of the study, judgment sampling
has been used. In judgment sampling
technique, on the basis of the researchers
judgment, sample is selected which is considered
as representative of the population. So in this
case on the basis of my judgment sample has
been selected.
Instrumentation Technique
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Most of the questions are close end ed questions
in the questionnaire administered to the
respondents. The simple category scale and
multiple response scale have been used.
Ranking scale has been used wherever
appropriate.
Data Analysis
This involved reducing the accumulated data to a
manageable size, developing summaries,
looking for patterns which will help the
objectives of the stud y and applying of statistical
techniques. After the collection of data, coding
sheet was prepared to classify the data. The

various tools which were used to for presentation
and testing of h ypothesis are:
Bar graphs.
Pie charts.
Column graphs.
Limitations of the Study

This is an academic effort and it is limited to
cost, time and geographical area.
As the data is collected from 50 respondents
only, generalization to other women
investors is inevitable.
An interpretation of this study is based on the
assumption that the respondents have
given correct information.

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PRESENTATION AND
ANALYSIS OF DATA
AND
INTERPRET
ATION
TABL
E1
Occupation of the
Women Investors
PARTICULARS
PERCENTAGE
NUMBER

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Govt sector Employee

20
10
Private Sector employee

50
25
Self Employed
10
House Wives
20
10
TOTAL
100 50
Findings:
Majority of the women are private sector
employees. This accounts for 50% of the
respondents. Next 20% of the respondents were
house wives and the percentages of
respondents were govt employees. Only 10% of
the women were self employed.
CHA
RT 1
Occupation of the
Women Investors

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60
50
40
30
20
10
0
G ovt employee P riv at e
Self Employed H o use W ives
em pl oyee
Occ
up
atio
n
Interpretation:
Most of the women respondents who were
interviewed were working in private sector and
had the majority. Next equal percentage of
respondents was govt employees and house
wives. The least number of women are self
employed. There is a trend of the women
becoming independent financially which can be
highlighted.
TABL
E2
Age of Women
Investors

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PARTICULARS
NUMBER PERCENTAGE
Between 20 and 30
20
10
Between 30 and 40
44
22
Between 40 and 50
26
13
Above 50
10
TOTAL
100 50
Findings:
Majority of the women respondents are in the age
group which lies between 30tears to 40
years. This percentage is 44%. The next highest
percentage of the women is in the age group
which is between 40 years and 50 years which
has a percentage of 26%. The next highest
percentage of 20% of women respondents are in
the age which lies between 20 years ans 30
years. The least percentage of women
respondents in terms of age are in age group of
50
years and above.
CHAR
T2
Age of Women
Investors

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50
40
30
20
10
0
Be tw ee n 20 and Be tw e e n 30
and B et w e e n 40 and 50 and
above
30
40
50
A
g
e
Interpretation:
Most of the women are in the age group which is
between 30 years and 40 years. And the
next highest percentage of women aged between
40 years and 50 years. This is closely
followed by women in the age group of 2o to 30
years. Least percentage of the respondents
is above 50 years. Most of the women are in the
middle age and above.
TABL
E3
Marital status of
Women Investors

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PARTICULARS
NUMBER PERCENTAGE
Yes
60
30
No
40
20
TOTAL
100 50
Findings:
Most of the respondents are married with a
percentage of 60%.The rest of the respondents
with a percentage of 40% are single.
CHAR
T3
Marital status of
Women Investors

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Married
Single
Interpretation:
Most of the women respondents who were
surveyed were married to understand the relation
between marital status and investing habits this
consideration is taken. Most of the women
who are married have a tendency to invest in
much secure investments and assets which give
benefit in the long term.the rest of the
respondents who are single have mainly invested
in
the avenues irrespective of their long term
growth.
TABL
E4
Annual Income of
Women Investors
PARTICULARS
PERCENTAGE
NUMBER
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Less than Rs100000

2.5
Between Rs100000 and

50
Rs250000
20
Between Rs250000 and
18
45
Rs500000
Above 500000
2.5
TOTAL
100 50
Findings:
50% of the respondents had an income level
which was between Rs1 lakh and Rs2.5 lakh.
That is half the number of the respondents. 45%
of the respondents consisted of women who
had a income between Rs2.5 lakh and Rs 5 lakh
and the least of 2.5% each by women who
earn less than Rs 1 lakh and above Rs 5 lakh.
GRAP
H4
Annual Income of
Women Investors

45
In
ve
st
m
e
nt
be
h
av
io
r
of
W
o
m
e
n
In
ve
st
or
s
60
50
40
30
20
10
0
Less than Be tw een 1 lakh Be tw een
2.5 A bove 5 lakh
Rs100000 and 2.5 Lakh la kh and 5
Lakh
Annual
Income
Interpretation:
Majority of the women are earning an income
which lies between Rs 1 lakh and Rs2.5 lakh
and accordingly plan their investment. Very
closely it is followed by women earning
between Rs2.5 lakh and Rs5 lakh and the least
number by women who earn less than Rs1
lakh and above Rs5 lakh.
TABL
E5
Percentage of Income
invested by Women
PARTICULARS
NUMBER PERCENTAGE
46
In
ve
st
m
e
nt
be
h
av
io
r
of
W
o
m
e
n
In
ve
st
or
s
Less than 10%

8
10% to 20%
70
35
20% to 30%
20
10
More than 30%

2
TOTAL
100 50
Findings:
70% of the women have invested 10% to 20% of
their income followed by women who
have invested 20% to 30% of their income
constituting 20% of the respondents and 8% of
the women have invested less than 10% of their
income and least percentage of 2% of
women have invested more than 30% of their
income.
GRAP
H5
Percentage of Income
invested by Women

47
In
ve
st
m
e
nt
be
h
av
io
r
of
W
o
m
e
n
In
ve
st
or
s
80
70
6 0
50
40
30
20
10
0
Less than 10 10 to 20 20 t o
30 Above 30
Pe r ce ntage of
Incom e Invested
Interpretation:
Most of the women have invested 10% to 20% of
their income making them conservative
investors. Then few of them have invested 20%
to 30% of their income which is not a big
percentage and few of them have invested less
than 10% of their income as many women
dont have a thorough knowledge of all the
investment avenues and the least percentage of
women have invested more than 30% as they
dont want to take risks.
TABL
E6
Investment Decision taken
by Women themselves
48
In
ve
st
m
e
nt
be
h
av
io
r
of
W
o
m
e
n
In
ve
st
or
s
PARTICULARS
NUMBER PERCENTAGE
Yes
60
30
No
40
20
TOTAL
100 50
Findings:
Most of the women consisting of 60% of them
take their own investment decision and the
rest 40% of the women dont take their own
investment decision independently.
GRAP
H6
Investment Decision taken
by Women themselves

49
In
ve
st
m
e
nt
be
h
av
io
r
of
W
o
m
e
n
In
ve
st
or
s
Yes
No
Interpretation:
With financial independence most of the women

have increased their knowledge and
increased their awareness levels about various
investment avenues and have taken their own
investment decision. But still there are a big per
centage of women who have not been able to
take independent decisio ns and rely on others for
their own investment decisions.
TABL
E7
Formulation of a
Financial Plan

50
In
ve
st
m
e
nt
be
h
av
io
r
of
W
o
m
e
n
In
ve
st
or
s
PARTICULARS
NUMBER PERCENTAGE
Yes
10
No
90
45
TOTAL
100 50
Findings:
90% of the women dont have a formal financial
plan and the rest 10% of the women have
formally formulated a fin ancial plan.
GRA
PH 7
Formulation of a
Financial Plan

51
In
ve
st
m
e
nt
be
h
av
io
r
of
W
o
m
e
n
In
ve
st
or
s
Yes
No
Interpretation:
Most of the women have not made any formal

plans regarding various financial
requirements and goals. So a majority of women
have not planned for their finances and
other investment avenues and have invested as
opportunities have come. With an absence of
financial plan they may lack focus on financial
goals.
TABL
E8
Agreement on Financial Goals by
Women and their Spouse

52
In
ve
st
m
e
nt
be
h
av
io
r
of
W
o
m
e
n
In
ve
st
or
s
PARTICULARS
NUMBER PERCENTAGE
Yes
83.33
25
No
16.67
TOTAL
100 30
Findings:
83.33% of the women have agreement with their
spouse on the financial goals they have in
their lives. Rest percentage of 16.67% of the
women has disagreement with their spouse on
their financial goals.
GRAP
H8
Agreement on Financial Goals by
Women and their Spouse

53
In
ve
st
m
e
nt
be
h
av
io
r
of
W
o
m
e
n
In
ve
st
or
s
yes
No
Interpretation:
Most of the women have a tendency t o take guid
ance with their spouse if they are married.
So there will be a consensus on the financial
goals and the various investment decisions they
take. A very le ss percentage of women dont
have an agreement with their spouse over
various investment decisions as some of them
may not have consensus with their spouse.
TABL
E9
Ranking of Factors considered while
taking Investment Decisions
54
In
ve
st
m
e
nt
be
h
av
io
r
of
W
o
m
e
n
In
ve
st
or
s
OPTIONS/
NUMBER
OF
RESPONDENTS/PERCENTAGE
TOTAL
RANKS 1 2 3 4 5
Long term
growth 4 6 18 20 2 50
Percentage 8 12 36 40 4 100
Risk 8 25 10 3 4 50
Percentage 16 50 20 6 8
100
Return 5 6 17 19 3 50
100
Retirement 5 23 9 5 8 50
income
100
Liquidity 19 16 6 5 4 50
100
Findings:
38% of the women have ranked liquidity as the
most important consideration. The next
consideration according to them is risk with 50%
of the respondents having that as a
consideration. 30% of the respondents have given
long term growth as the next important
factor and the next important factor is return with
40% of the respondents choosing it. The
least important factor is retirement income with
16% ranking it as 5.
GRAP
H9
Ranking of Factors considered while

taking Investment Decisions

55
In
ve
st
m
e
nt
be
h
av
io
r
of
W
o
m
e
n
In
ve
st
or
s
60
50
L o n g term
40
gr o wt
h
R is k
30
R etu rn
20
R etirem en t
in co m e 10
L iquidity
0
Ran k 1 Rank 2 Rank 3 Rank 4
Rank 5
Rank s
Interpretation:
Majority of the women are of the opinion that
liquidity i s the most important factor to be
considered while taking investment decisions.
Risk is the next important factor to be
considered as women avoid taking high risk. As
women take the decision regarding the
education and marriage of children, long term
growth is the next important factor to be
considered. Their main concern is not return; it
has been ranked 4 as they are happy with
moderate returns and low risk. As most of the
respondents were in the age group of 30years
to 40 years, it is evident that retirement income is
at the end of the priority list
TABL
E 10
Knowledge about investing and
various options available

56
In
ve
st
m
e
nt
be
h
av
io
r
of
W
o
m
e
n
In
ve
st
or
s
PARTICULARS
NUMBER PERCENTAGE
No investment
0
experience
Basic understanding
70
about investing
35
Investing for long time

20
10
Experienced investor
10
TOTAL
100 50
Findings:
70% of the women had the basic understanding
about investing and have made some
investments. 20% of the women have b een
investing for several years in different types of
assets and 10% of the women are experienced
investors. Respondents having no investment
experience are none.
GRAP
H 10
Knowledge about investing and
various options available

57
In
ve
st
m
e
nt
be
h
av
io
r
of
W
o
m
e
n
In
ve
st
or
s
80
70
60
50
40
30
20
10
0
No expeience Basic
Some
Expeience Experienced
Understanding
Experience
in
Investing
Interpretation:
Most of the women have a basic understanding
about investing which is a good trend to
encourage more participation in investments. A
lesser percentage has been investing in
different types of assets for some years so there is
a slow increase in participation of women
in investment portfolio. But a very low
percentage of women who are experienced as
many
women dont take active participation in
investment
avenues. But there are no
respondents
who have no investment experience at all.
Therefore all the women have invested one or the
other of the investment avenues.
TABL
E 11
Description
Investment
Objectives
of

58
In
ve
st
m
e
nt
be
h
av
io
r
of
W
o
m
e
n
In
ve
st
or
s
PARTICULARS
NUMBER PERCENTAGE
Investing in safer
78
investments
39
Overall high returns

14
High returns without

8
concern for decrease in
investments
TOTAL
50 100
Findings:
78% of the women prefer to invest in safer
investments. 14% of the women are willing to
tolerate some ups and downs in the value of
investments to achieve higher returns in the
long run. The least percentage of 8% of the
women has main inter est in the high long term
returns.
GRAP
H 11
Description
Investment
Objectives
of

59
In
ve
st
m
e
nt
be
h
av
io
r
of
W
o
m
e
n
In
ve
st
or
s
Investment
Objectives
100
80
60
40
20
0
safer Investments Moderate
risk
High Return
in
ve
st
m
en
ts
in
ve
st
m
en
ts
Investm
ent
Objectiv
es
Interpretation:
As the majority of the women prefer investing in
safer investments, they are conservative
investors. Next few of the women are willing to
take some risk for long term return so they
are moderate investors. Very less percentage of
women are aggressive investors who are not
concerned about short term decreases in their
investment for high, long term returns. So it
can be inferred that most of the women are
conservative investors
TABL
E 12
Stand on the planning of various

Financial Requirements

60
In
ve
st
m
e
nt
be
h
av
io
r
of
W
o
m
e
n
In
ve
st
or
s
OPTIONS PLANNED
PLANNED
NOT
Number
Percentage
Number
Percentage
Basic Savings 38 76 12 24
Household
Expenses
28 56
22
44
Retirement
Planning
19 38
31
62
Buying of Assets 25 50 25 50
Tax Planning 39 78 11 22
Life Protection 40 80 10 20
Medical Expenses 22 44 28 56
Childrens
Education
17 66
33
34
Childrens Marriage 29 58 21 42
Basic Savings 38 76 12 24
Findings:
76% of the women have planned for basic
savings plan and 24% of women have not
planned for it. 56% of the women have planned
foe household expenses and 44% of the
women have not planned for it. 38% of the
women have planned for retirement and 62% of
them have not planned for their retirement. 50%
of the women have planned for buying of
assets whereas 50% have not planned. 78% of
women have done tax planning and 22% of
the women have not done tax planning. 80% of
the women have undertaken life protection
policies and the remaining 20% of the women
have not planned for life protection. 44% of
the women have planned for medical expenses
and the rest 66% of the women have not
planned for it. 58% of the respondents have
planned for their childrens marriage and 42%
have not planned for it. 76% of the women have
planned for basic savings and 24% of the
women have not planned for it.
GRAP
H 12
Stand on the planning of various
Financial Requirements
61
In
ve
st
m
e
nt
be
h
av
io
r
of
W
o
m
e
n
In
ve
st
or
s
planned
90
not planned
70
60
50
40
30
20
10
0
80
Various
financial require
ments
Interpretation:
Most of the women have planned for basic
savings, household expenses, tax planning, life
protection, childrens education and childrens
marriage. Many of them have not planned for
retirement and for medical expenses as they are
secondar y to them. For them most important
considerations will be basic savings, education
and marriage of children etc.
TABL
E 13
Reaction of Women Investors due to
decrease in portfolio value

62
In
ve
st
m
e
nt
be
h
av
io
r
of
W
o
m
e
n
In
ve
st
or
s
PARTICULARS
NUMBER PERCENTAGE
Transfer of money
54
immediately
27
Concerned but wait for

36
improvement
18
Leave the investments

10
with expectation of
improvement
Invest more funds

-
TOTAL
100
50
Findings:
54% of the women would transfer their money in
to more secure sectors if their investments
decrease in value. Next 36% of the women will
be concerned but will wait and only 10% of
the women would leave the investment and wait
for improvement. None of them would
invest more funds to lower their average
investment price.
GRAP
H 13
Reaction of Women Investors due to
decrease in portfolio value
63
In
ve
st
m
e
nt
be
h
av
io
r
of
W
o
m
e
n
In
ve
st
or
s
60
50
40
30
20
10
0
Transfer
Concerned Wait for
Invest more
Money
improvement
funds
Reaction on decrease in
portfolio va lue
Interpretation:
Most of the women cannot take risk and so they
cannot wait for improvement as they are not
very high risk takers with decrease in portfolio
value. Few of them will be concerned and
very few will wait for improvement by leaving
them. So it can be inferred that they cannot
afford to take risk. As they dont invest often,
they have less experience.
TABL
E 14
Investment
Avenues
already invested in
64
In
ve
st
m
e
nt
be
h
av
io
r
of
W
o
m
e
n
In
ve
st
or
s
OPTIONS NUMBER PERCENTAGE

Yes No Total Yes No
Total
Govt
15 35 50 30 70 100
securities
Equity 10 40 50 20 80 100
Bonds 5 45 50 10 90 100
Mutual
6 44 50 12 88 100
funds
Company - 50 50 - 100 100
deposits
Bank
deposits
Post office
deposits
Insurance
Provident
fund
Real estate
39 11 50 78 22 100
37 13 50 74 26 100
32 18 50 64 36 100
43 7 50 86 14 100
9 41 50 18 82 100
Findings:
30% of the women have invested in govt
securities and 70% have not invested. 20% of the
women have invested in shares and 80% have not
invested in shares. 10% of the women
invested in bonds and 90% have not done so.
12% of the women have invested in mutual
funds and 88% have not. None of the respondents
have invested in company deposits. 78%
of the women have invested in bank deposits and
22% of the women have not invested in
bank deposits. 74% of the women have invested
in post office deposits and 26% of the
women have not invested. 64% of the women
have invested in insurance and 36% of the
women have not done so. 86% of the women
have invested in Provident fund and 14% have
not done so. 18% of the women have invested in
real estate and 82% of the women have not.
GRAP
H 14
Investment
Avenues
already invested in
65
In
ve
st
m
e
nt
be
h
av
io
r
of
W
o
m
e
n
In
ve
st
or
s
120
100
80
Yes 60
40
No
20
0
Investment Ave nu
Interpretation:
Most of the women have invested in low risk
investments as they are low risk takers. They
have invested in bank deposits, post office
deposits, insurance, provident fund which have
low risk and low returns. But they have avoided
investing in shares, bonds, company
deposits which could be due to their high risk
involvement and less knowledge of women
regarding various instruments.
TABL
E 15
66
In
ve
st
m
e
nt
be
h
av
io
r
of
W
o
m
e
n
In
ve
st
or
s
Basis
of
Investment
Decision on the advice of
PARTICULARS
NUMBER PERCENTAGE
Themselves
12
Friends
38
19
Family Members
46
23
Investment Advisor
4
TOTAL
100
50
Findings:
46% of the women base their decisions on the
advice of their family members. 38% of the
women base their decisions on the advice of their
friends. 14% of the women base their
decisions on their own. The least percentage of 4
5 of the women based their decision on the
advice of the investment advisor.
GRAP
H 15
Basis
of
Investment
Decision on the advice of
67
In
ve
st
m
e
nt
be
h
av
io
r
of
W
o
m
e
n
In
ve
st
or
s
50
40
30
20
10
0
Yourself Your Friend Family
Investment
m
e
m
b
er
s
a
d
vi
s
or
Advice
Of
Interpretation:
Most of the women take decisions by takin g the
advice of their family members. Many of
the women also take their friends advice. A very l
ess percentage of women take their
decisions themselves without any advice. Very
few of the women go to the investment
advisor. This could be due to the fact that they
dont have a formal financial plan and which
in turn results in absence of a fixed financial goal.
TABL
E 16

68
In
ve
st
m
e
nt
be
h
av
io
r
of
W
o
m
e
n
In
ve
st
or
s
Tolerance of Risk of
Women Investors
PARTICULARS
NUMBER PERCENTAGE
Very high
6
Moderately high
28
14
Average
58
29
Moderately low
4
Very low
4
TOTAL
50 100
Findings:
58% of the women have an average tolerance
level and 28% of the women have moderately
high risk tolerance level. 6% of the women have
ver y hi gh risk tolerance level. 45% of the
women have moderately low and ver y low risk
tolerance level.
GRAP
H 16
Tolerance of Risk of
Women Investors
69
In
ve
st
m
e
nt
be
h
av
io
r
of
W
o
m
e
n
In
ve
st
or
s
70
60
50
40
30
20
10
0
Risk
tolerance
Interpretation:
It can be inferred that most of the women are
moderate risk takers as can be seen above.
They dont take high levels of risk even if it gives
high returns. Many of them are
moderately high risk takers. Very few of them
take high risk and are aggressive investors.
Very less number of women has low risk
tolerance. Most of the women dont want to take
high levels of risks even if it yields high returns
on the investments.
TABL
E 17
Overall
Investment
Objective

70
In
ve
st
m
e
nt
be
h
av
io
r
of
W
o
m
e
n
In
ve
st
or
s
PARTICULARS
NUMBER PERCENTAGE
Growing assets
18
Growing assets with
30
60
current income
Income and preserving
22
capital
TOTAL
11
50 100
Findings:
60% of the women have the investment objective
which is growing assets while generating
current income. 22% of the respondents want to
generate income and preserve capital. Least
percentage of 18% of women wants growing
assets without concern for current income.
GRAP
H 17

71
In
ve
st
m
e
nt
be
h
av
io
r
of
W
o
m
e
n
In
ve
st
or
s
Overall
Investment
Objective
70
60
50
40
30
20
10
0
Growing assets Income and
Income and
generati
ng
preservi
ng
incom
e
capital
Investment
objectives
Interpretation:
Most of the women have financial goals of
generating assets which grow along with
generation of income. So they want financial
security with long term growing assets with
income. A lesser percentage of women want
growing assets even if doesnt generate curr ent
income as it involves risk. Women in this categor
y have a very low percentage.
TABL
E 18

72
In
ve
st
m
e
nt
be
h
av
io
r
of
W
o
m
e
n
In
ve
st
or
s
Use of funds in the

portfolio in years
PARTICULARS
NUMBER PERCENTAGE
12
Above 10 years
6 to 10 years
66
33
0 to 5 years
22
11
TOTAL
50 100
Findings:
66% of the women will use the funds in the
portfolio in 6years to 10 years. 22% of the
women will use it in 0years to 5 years and 12%
of the women will use the funds in time
period more than 10 years.
GRAP
H 18

73
In
ve
st
m
e
nt
be
h
av
io
r
of
W
o
m
e
n
In
ve
st
or
s
Use of funds in the

portfolio in years
70
60
50
40
30
20
10
0
Above 10 years 6 to 10
years 0 to 5 years
Us e of Funds
Interpretation:
Most of the women dont have a ver y lon g term
use of funds as a goal. They want to use it
in 6 years to 10 years which is not a long period.
Very few of the women use them in less
than 5 years. A lesser percentage uses the funds in
their portfolio in more than 10 years. As
women generally invest in funds which generate
incomes in long term but invest in avenues
which are medium and short term current income
generation.

74
In
ve
st
m
e
nt
be
h
av
io
r
of
W
o
m
e
n
In
ve
st
or
s
&21&/8
6,216
CONCL
USIONS
75
In
ve
st
m
e
nt
be
h
av
io
r
of
W
o
m
e
n
In
ve
st
or
s
Women have invested a very less
percentage of their income as many wo men
dont
have a thorough knowledge of all the
investment avenues they dont want to
take
risks.
There are a big percentage of women who
have not been able to take independent
decisions and rely on others for their own
investment decisions.
A majority of women have not planned for
their finances and other investment
avenues
and
have
invested
as
opportunities have come.
Majority of the women are of the opinion
that liquidity i s the most important factor
to be considered while taking investment
decisions.
Most of the women have a basic
understanding about investing which is a
good trend
to encourage more participation in
investments.
Most of the women prefer investing in safer
investments, they are conservative
investors.
Most of the women have planned for basic
savings, household expenses, tax
planning, life protection, childrens
education and childrens marriage.
Most of the women cannot take risk and so
they cannot wait for improvement as they
are not very high risk takers with decrease
in portf olio value.
Most of the women have invested in low
risk investments as they are low risk takers.
They have invested in bank deposits, post
office deposits, insurance, provident fund
which have low risk and low returns.
Most of the women take decisions by taking
the advice of their family members as
they need guidance b y the ex perienced
people.
Most of the women have financial goals of
gen erating assets which grow along with
generation of income. So they want
financial security with long term growing
assets
with income.
As women generally invest in funds which

gener ate incomes in long term but invest
in avenues which are medium and short
term current income generation.

76
In
ve
st
m
e
nt
be
h
av
io
r
of
W
o
m
e
n
In
ve
st
or
s
It can be concluded that generally, women are
conservative investors and they feel that
safeguarding what they have is top priority. These
investors want to avoid risk
particularly the risk of losing an y principal that
is their original investment even if that
means theyll have to settle for ver y modest
returns.

77
In
ve
st
m
e
nt
be
h
av
io
r
of
W
o
m
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6&+(0
(2)
5(&200(1'$7
,216

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SCHEME
OF
RECOMMENDATI
ONS
Women should be encouraged to invest
in more avenues and participate in the
investment avenues which involve
high risks and also high returns.
Women should focus on making a formal
financial plan to have a focus on the
financial goals.
Women should increase their awareness

level of the portfolio diversification to
spread their risk.
Women should recognize their financial
independence and plan for the future to
make it better.

79
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ve
st
m
e
nt
be
h
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io
r
of
W
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n
In
ve
st
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s
%,
%/,2*5$3
+<
80
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e
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io
r
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e
n
In
ve
st
or
s
BIBLIOG
RAPHY
www.merilllynch.com
www.financialplanning.com
www.investorhome.com
India Today
Business Line

81
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ve
st
m
e
nt
be
h
av
io
r
of
W
o
m
e
n
In
ve
st
or
s
$11(;85
(6

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ve
st
m
e
nt
be
h
av
io
r
of
W
o
m
e
n
In
ve
st
or
s
QUESIO
NNAIRE
1. Occupation
Govt employee
Private sector emplo yee
Self employed
Others ( Please specify )
2. Age
Between 20 and 30
Between 30 and 40
Between 40 and 50
50 and above
3. Marital status
Married
Single
4. What is your annual income?
Less than Rs. 100000
Between Rs. 100000 and Rs. 250000
Between Rs. 250000 and Rs. 500000
Above Rs. 500000
5. What percentage of your income is invested?
Less than 10%
10% to 20%
20% to 30%
More than 30%
6. Do you take your own investment decisions?
Yes
No
7. Do you have a formal financial plan?

Yes
No
8. Do you and your spouse generally agree on
your financial goals?
Yes
No
83
In
ve
st
m
e
nt
be
h
av
io
r
of
W
o
m
e
n
In
ve
st
or
s
9. What factors do you consider while taking an
investment decision? Rank the following on
the scale of 1 to 5 (1 most important and 5
least important)
FACTORS
RANK
a) Lon g term growth
b) Risk
c) Return
d) Retirement income
e) Liquidity
10. How knowledgeable are you about investing

and the various options available?
I have no investment experience.
I have a basic understanding about investing and
have made some investments.
I have been investing for several years in
different types of assets.
I am an experienced investor.
11. Which of the following statements would you
feel most correctly describes your
investment philosophy?
I prefer to invest in safer investments.
I am willing to tolerate some ups and downs in
the value of my investments to achieve
overall higher returns in the long run.
My main interest is high, long term returns and I
am not concerned about short term
decreases in my investments.
12. Indicate your stand on the following:
PARTICULARS
NEEDS PLANNING
a) Basic savings plan
----b) Household expenses
----c) Retirement planning
----d) Buying of assets
----e) Tax planning
----f) Life protection
----g) Medical expenses
PLANNED
------------------------------------
----h) Childrens education

----i) Childrens marriage
-----
-----------
13. What would your reaction be, if in 6 months

after placing your investments, your
portfolio decreases in value?
Transfer your money into more secure investment
sectors.
You would be concerned, but would wait to see if
the investments improve.
You would leave the investments in place
expecting the investments to improve.
You would invest more funds to lower your
average investment price.

84
In
ve
st
m
e
nt
be
h
av
io
r
of
W
o
m
e
n
In
ve
st
or
s
14. What are the various investment avenues you
have already invested in?
PARTICULARS
YES
NO
a)
Govt
securities
----------b)
Equity
----------c)
Bonds/debentures
----------d)
Mutual
funds
----------e)
Company
Deposits
-----f)
-----g)
-----h)
-----i)
-----j)
-----
-----Bank
Post
Deposits
-----Office
------
Deposits
Insurance
-----Provident
Fund
------
Real
Estate
------
15. You base your investment decisions on the

advice of :
Yourself
Your friend
Your family members
Investment advisor
16. Risk tolerance is the relative ability to accept
measurable losses in the short term in
exchange for ex pected higher returns long term.
Your tolerance for risk is:
Very high
Moderately high
Average
Moderately low
Very low
17. My overall investment objectives are:
Growing assets without concern for current
income.
Growing assets while generating current income.
Generating income and preserving capital.
18. I plan to use the funds in this portfolio in
Above 10 years
6 to 10 years
0 to 5 years.
19. What in your opinion will help women in
building better portfolio

85

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Investm

Investment Behaviour of Women

UNDER THE GUIDANCE

BANGAL ORE 560

M. P.Birla Institute of Management, Associate B hartiya

Principal, MPBIM, Bangalore

M. P.Birla Institute of Management, Associate

Principal for his guidance and supervision.

M. P.Birla Institute of Management, Associate

M. P.Birla Institute of Management, Associate

M. P.Birla Institute of Management, Associate

M. P.Birla Institute of Management, Associate

households have become more prosperous. The

M. P.Birla Institute of Management, Associate

investors whole doing their financial planning

46% of the women base their decisions on the

M. P.Birla Institute of Management, Associate

roles they play in life. That's why takin g control

M. P.Birla Institute of Management, Associate

Women are more likely to live longer

Financial Planning Process

M. P.Birla Institute of Management, Associate

with a strategy or plan for how they can

throughout the lifetime.

dependence on others for economic

communicated financial decisions.

anticipating expenses, and achieving the

M. P.Birla Institute of Management, Associate

Development of financial goals

Identifying alternative courses of action

Creating and implementing a financial

Evaluating and revising the plan.

Step 1: Determination of Current Financial

current financial situation with regard to

identifying how they feel about money

goals for investors; however, they must

goals can range from spending all of their

will influence the available alternatives,

Expand the current situation.

Change the current situation.

Take a new course of action.

Not all of these categories will apply to

represent possible courses of action.

effective choices. Considering all of the

possible alternatives will help the investor

situation, personal values, and current

decision to invest in stock may mean an

investor needs to consider the lost

career field involve risk.

of risk, such as putting money in a

account or purchasing items that cost ver

to consider risk is to gather information

M. P.Birla Institute of Management, Associate

Changing personal, social, and economic

process, investor will develop an action

This requires choosing ways to achieve

For example, investor may use the

particular action. They need to regularly

will provide a vehicle for adapting to

To achieve the best results from financial

M. P.Birla Institute of Management, Associate

money monthly, or even quarterly, that money

M. P.Birla Institute of Management, Associate

it's time to sell, they may have to take a