Individuals investors behavior: A study of commodity market Rakesh H M Assistant Professor, Dept. of MBA, Vidyavardhaka College of Engineering, Mysore Online published on 7 June, 2014. Abstract The finance is being studied for thousands years and behavioral finance which considers human behaviors in finance is a quite new area. Behavioral finance theories, which are based on the psychology, attempt to understand how emotions and cognitive errors influence individual investors’ behaviors (investors mentioned in this study are referred to individual investors). Under the concept of behavioral finance, it is presumed that information structure and characteristics of capital market participants systematically influence the decisions as well as market outcomes. As the investor's investment decisions in any one particular market tend to rely more on their behavior derived from psychological principles of decision making, a better understanding of behavioral processes and outcomes is important for financial planners. This article is focusing on exploring the factors influencing the behavior of investors towards commodity market in India. The study is based on primary data and adopted survey approach to measure the investors’ behavior. The respondents are individual/retail investors selected randomly in Mysore district. Questionnaire has being prepared with 15 items for measuring the behavior was distributed and the total number of respondents was 300. Cronbach alpha method was applied to check reliability and validity of the data. The main components underlying are those that have greater influence on the investors’ behavior were ascertained by multivariate analysis called Principal component method of Factor analysis with varimax rotation. The descriptive analysis was also used to explore the degree of influence of main components on the behavior of investors. The results of analysis has four major factors that have greater influence on the behavior of investors, viz., low risk, informational asymmetry, high return and objective knowledge. Top Keywords Behavioral Finance, Capital Market, Investor's Behavior, Psychological Principle, Decision Making. Top |