Major Research Project

On

“Impact of availability bias, overconfidence bias, low aversion bias

on investment decision making”

Towards Partial Fulfillment of Requirements of Master of Business Administration

Degree

Submitted To:- Submitted By:-

Shaifali Chauhan Mrinalini Upadhyay
(Faculty Guide) Sachin Bandil
(MBA III Semester)

Opposite Deen Dayal Nagar, Bhind Road, Gwalior

Ph.0751-2470745, Fax-0751-470516
E-mail: [email protected]
 DECLARATION

I, (Sachin Bandil, Mirinalini Upadhay) of MBA IV Semester of Prestige Institute of

Management Gwalior, hereby declare that the Major Research Project report entitled
“Impact of availability bias, overconfidence bias, low aversion bias on investment
decision making” is submitted by me in the line of partial fulfillment of course objectives
for the Masters of Business Administration Degree.

I assure that this report is the result of my own efforts and that any other institute for the
award of any degree or diploma has not submitted it.

Date: Mrinalini Upadhyay

Place: Gwalior Sachin Bandil

 CERTIFICATE

This is to certify that (Sachin Bandil, Mirinalini Upadhyay) Student of MBA III of Prestige
Institute of Management Gwalior has successfully completed his/her Major Research Project
Report. She has prepared this report entitled “Impact of availability bias, overconfidence
bias, low aversion bias on investment decision making” under my direct supervision and
guidance.

Prof. Shaifali Chauhan

 ACKNOWLEDGEMENT

I, (Sachin Bandil, Mirinalini Upadhay) express my sincere gratitude to (Prof. Shaifali

Chauhan) giving me the opportunity to work under his/her guidance on the report entitled
“Impact of availability bias, overconfidence bias, low aversion bias on investment
decision making”

I am grateful to The Director of the institute Dr. S. S. Bhakar, MRP coordinator (Prof.Abhay
Dubey) Faculty Member and other friends for their valuable suggestions in the execution of
report preparation.

I am also thankful to other staff that guided and helped us very kindly at each and every step
whenever I required.

I also acknowledge & convey thanks to the library staff, computer department of PIMG for
their kind and valuable support.

Mrinalini Upadhyay

Sachin Bandil
 TABLE OF CONTENTS

Chapter Page No.

1 Introduction 1-11

1.1 Conceptual Framework 1-5

1.2 Review of literature 6-10
1.3 Rationale 11
1.4 Objectives 11

2 RESEARCH METHODOLOGY 13-14

2.1 The study 13
2.2 The sample design 13
2.3 2.2.1 Population 13
2.2.2 Sample size 13
2.2.3 Sample element
2.2.4 Sampling technique 14
2.4 Tools to be used for Data collection
2.5 Tools to be used for Data Analysis

3. CHAPTER SCHEME FOR MRP REPORT

References

Questionnaire
CHAPTER 1
1. Introduction

1. 1 Conceptual Framework

Investment Decision Making

According to Investment decision making, investors are perfectly rational in financial

decisions but sometimes emotions and psychology impact our decisions, causing us to behave
in unpredictable or irrational ways. All Investor require to get return from their investment to
make optimal investment decision (Sharp, 1964) explain that maximum scale of risk for
special level of return to compare the investment decision from benchmark. The explanation
of behavioral finance provides of this phenomenon in investment decision making is the
psychological and perceptional process of results and selection of a course of action to
several alternative situations. The behavioral of finance study the influence to the
psychological factors on an individual investment decision making behavior of investors. The
financial research advocates to new approach of the investment decision is affected by
psychological and emotional factors. Behavioral finance is the basic supposition that, data
structure combining with aspects of the market sector to the investment impact of member
choices of investors and market results. Investment doesn’t reasoning mechanism function of
computer rather; a person’s mind frequently operates data exploit emotional channels and
alternatives. The Standard finance of sector are expects of members the foundations, and
investment decision markets are rational. Those individuals build up the rational decisions
and increase their wealth. The individual of any who makes irrational decisions will suffer
from poor results. That investment decision making of maximizes their return yet the number
of investor’s research is not always so rational. The uncertainty of human regarding puzzled
when investment decision engulfs them. Some People are not always reasonable and markets
are not always efficient. The decisions making of behavioral finance explains why individual
do not always make they are expected to make and why markets do not reliably to be they are
expected to behave. The average investors recent research shows that make decisions based
on emotion, not logic; most investor are buy high and sale low on mood. The studies of
psychological reveal of losing some money of investment are really three times greater than
the joy of earn money. The investment decision is some investor emotions such as fear and
greed focal role in investor’s decision; there are also other causes of steep behavior. The
research observed that the stock price moves up and down on a daily purpose without any
change in elemental of economy. the stock market is observed that the people move in
cluster and this impact of stock price. The investment decision making investors are
individual to usually depend on their own factors such as age, investment portfolio,
education, income, etc. Simultaneously, the investment decisions making are also derived
from different models of finance. The models depend on expected risk and the investment
return of associated and risk-based asset pricing models like CAPM (Capital Asset Pricing
Model). But the investment decisions making should not be made only by depend on the
personal resources and difficult models, not be considering the situational factors. The
investment decisions processes are making to choose a particular alternative from a number
of alternatives (Chandra 2008) .this activity are follows after actual evaluation of all the
alternatives. Hence the investment decision making need to keep themselves obtaining up-to-
date by information knowledge of diversified fields so that they can easily accomplish the
tasks they have to work upon. The financial behavior theories of complicated situations of
people are willing to admit standard decision-making strategies. For example, stock markets
people are afraid to invest in the due to occur the recent unpleasant event in this market. The
more decisions are made depend on features instead of making the evaluation of reality. In
other words, investment decisions making are made according to stereotypes. For example,
the events that occurred in the past that effects on future investment decisions, while it should
not keep faith only on past experiences.

Availability Bias
In Availability Bias investment decision maker depend upon knowledge that is readily
available rather than analysis other alternative and procedure. The investments Decision
makers of information in stock market are also influenced by they get during selection and
identification of stock. The most of investor’s are choice to change by keeping in mind their
cost of capital. The Investor preferences to change the available information as a result in a
Particular leading pattern and sometime even irrelevant information also influence investment
decision. The irrelevance information to effect investment decisions making negative, on the
basis of available information and risk taking behavior of investor about the particular
security of change the investment decision. The some past studies said of investors feel
comfortable in investment decision making depend on superior information The individual’s
tendency of judge the return and probability of event in terms of how easy to it is think of an
example of that event (Tversky & Kahneman, 1973) in such heuristic, individuals count on
knowledge is readily available, rather than examining other alternatives and procedures. The
most appropriate to leads the judgmental was considered for this study as it was difficult to
find respondents (individual investors) when desired. They were only available at stock
brokerage firms for a limited period. The suggestion that recent memory i.e., the available for
example influences of more investors take decision of investment i.e., if their investor has
recently saw huge loss in stock market and one investment avenue then he will not invest in
that avenue. The Investor will be more likely to be apprehensive of stock market if he has
been recently seen any stock market crisis. Pompian (2012), said that bias in which people
take a heuristic approach to estimating the probability of an outcome depend on how easily to
the outcomes come in the mind. The recent events are much more easily to remember and
available. Agrawal (2012) the maintain that all times to individuals behave irrationally and
their decisions are depend on tend to use shortcuts in arriving at decisions due to time and
capacity constraints in processing of information.

Overconfidence Bias
The investors to both overestimate of abilities and underestimate other ability or difficulty of
the task to insignificant number of people ranked themselves in the below average category;
but, as a matter of fact, 50 percent of the drivers are classified in the below average level. The
terms of investment in overconfidence and appears to have a direct application and who is
quite convoluted to involving future projection. The successful investment has skills in
recognizing to perhaps misapprehend by overconfident investors. The proposition by
traditional financial theory of the diversified portfolio of risk does not mount up to a specific
area. Inaccurate confidence may be more worth against this advice, with investors certain
about the positive projections of their investments, to invoke them to think that diversification
is needless. Overconfident of investors consider having more power over the investment and
what they have actually demonstrating the association of overconfidence with the control
issue. Reported by one of the researches, rich investors to claim that abilities of stock pick
were crucial to the performance of the portfolio. Where the actually, investors had
remarkable hopefulness about the stock performance they have selected and the impact of the
market misjudge as a whole on the performance of their portfolio. The behavioral of scientist,
confidence is a state of mind having full belief on ones abilities and on opposition
overconfidence is explained by taking this belief to a maximum extent. The investors have
identified that ‘confidence proves the pride they have in beliefs that tending to ignore any
information from rational investors Barber and Odean (2001). The most of basic form, in
Overconfidence can be brief as improper faith in one’s intuitive reasoning, judgments, and
cognitive abilities” (Pompian, 2006). Normally, people are generally overconfident regarding
their ability and knowledge. They tend to underestimate the imprecision of their beliefs or
forecasts, and they tend to overestimate their ability. This concept of Overconfidence derives
from a large body of cognitive psychological experiments and surveys in which subjects
overestimate both their own predictive abilities and the precision of the information which
have been given. In brief, people think they are smarter and have better information than they
actually do (Pompian, 2006). Agrawal (2012) noted that overconfidence causes people to
overestimate their knowledge, undervalue risks and overestimate their ability to control
events. The author claimed that overconfidence originates in people’s biased evaluation of
evidence. Many researchers find evidence for the presence of the overconfidence bias in
different financial decisions. According to Agrawal (2012), overconfidence affects not only
the behavior of secondary market traders but also investors in the primary market.
Overconfidence led to aggressive bidding and higher payment for securing the auctioned
shares. Frequent bidders also prove to be inferior in terms of stock selection performance.
This implies their overestimation of the future cash flow of the initial public offer (IPO)
firms, or underestimation of the risk of investment. People are generally overconfident
regarding their
Ability and knowledge. They tend to underestimate the imprecision of their beliefs or
forecasts, and they tend to overestimate their ability. Thus, overconfidence can cause
investors to under-react to new information and that leads to earn significantly lower yields
than the market.

Low Aversion Bias

Loss aversion investors think more actively or consciously to protect the decrease in capital
and fear of loss rather than growth in their Investments (profit). Loss aversion refers to the
tendency of people who are more sensitive to reduction in their capital than to increase in it
prospect theory. Loss aversion investor’s behavior cannot be judged in the small investment
and change in environment does not affect the decision of lose aversion investor and
individual’s parameter of loss aversion is similar in different choice Environments (Rabin,
2000). Pompian (2012) illustrates that in prospect theory, loss aversion occurs when people
tend to strongly prefer avoiding losses as opposed to achieving gains. The Loss aversion of
leads investors to hold their losers even the investment has little or no chance of going back.
Investors may as a result hold investments in a loss position longer than justified by
fundamental analysis. The investor of loss aversion is a tendency of investment decision
where investors are so fearful of losses and they focus on trying to avoid a loss more so than
on making gains. The more of one experiences losses, the more likely they are to become
prone to loss aversion.
Research on loss aversion shows that investors have feels the pain of a loss more than twice
as strongly as they feel the enjoyment of making a profit. The Investing in low-return
guaranteed to investments over more promising investments that carry higher risk. Not
selling a stock that you hold when your current rational analysis of the stock clearly indicates
that it should be abandoned as an investment. Selling a stock that has gone up slightly in price
just to realize a gain of any amount, when your analysis indicates that the stock should be
held longer for a much larger profit. Telling oneself that an investment is not a loss until it’s
realized (i.e., when the investment is sold). Individuals prefer to avoid loss rather than getting
equivalent gains; losses seem to be twice as powerful as the same amount of gains. For e.g.,
in a gamble, an individual when faced with the 50-50 prospect of gaining 50 lakh or losing 45
lakh will not accept the bet since the impact of the loss is perceived to be much higher than
the impact of the gain even when the gains are higher than the associated loss.
1.2 Review of literature

Investment Decision Making

Myers & Majluf (1984) the managers should have preferable information of stock is issued
of financial investment then stock price will be lower to other things equal.

Merton, (1987) some past researcher thinks to optimum and reasonable decision making
most of depend on advance knowledge of finance.

Cascio,Young, & Morris (1997) The investment of cost to benefit of investment can
impact.so why in order to take high returns to investors wander of the right and reasonable
decision making.

S. Umamaheshwari, M. Ashok Kumar (2014) the investment decision to aware the

environment of the unveiling intensions of responsibilities of the factors is responsible for the
investment decision policies. The behavioral finance helps to set up of various schemes of the
investments and required to rate of the investment return.

Bhawana Bhardwaj (2013) The National increment of yield for future by speculation.
Investment decision wards upon mindfulness about of speculation opportunity and
information of level to evaluation of speculation openings and choices of investment. The
greatest research of expresses respondents have chosen as Bank stores and the reserve
Provident as Speculation path. Investors favored strength of consequently Investment.

R. Sreepriya, P. Gurusamy (2013) the development of extra to pay in worth can be

accomplished the investment and the remunerations sitting tight for the primary quality of
investment. Speculation is portion financial assets to get returns over given period. Additional
assets are contributed with various channels by salaried and class individuals. The
exploration examination of diverse speculation roads and 81 percent respondents are
confronted issue at the hour of speculation.

J. Sidharthul Munthaga, M. Nazer (2013) the work on assets with expectation of getting
returns on it is called as investment. This Study was effect of components on investment
decision to conduct of individuals, and to perceive the mentality of speculators and towards
different investment alternatives. Information of data analysis reveals of 56 percent private
representatives and 30 percent of self-utilized and 14 percent open division workers to
received proficient administrations for investment.

Mir Zat Ullah Khan (2017) the information gives to help the fund manager and how to
make investment decision, how can take risk of investment, and how to generate portfolio of
investment for achieving desired returns. The data help and give ideas to fund managers how
to invest in particular way.
Kumar & Goyal, (2015) the psychological biases has an influence their on investment
decision making

Availability Bias on Investment Decision Making

Javed ,Bagh and Razzaq (2017)The effects of availability bias and representativeness have
positive and significant impact on perceived investment decision making performance. The
investors, the factors that influence their investment performance are important as these will
influence their financial plans of future. The Reflection of the said effect of behavioral impact
in the decision making process of individuals will make the decisions more optimal and
rational as well.
Haley &Stumpf, (1989) the analysis of decision makers in securities exchange are
additionally impacted by the data they get during choice and recognizable proof of stock.
Modigliani & Miller (1958) the investment of availability bias concept of cost of capital to
use the basis of the rational investment decision making with the firm.

Krichler, Maciejovsky,& Weber,(2010) As a result in a particular leading pattern and

sometime even irrelevant information also influence investment decision.

Grable, J Roszkowski Lytton & O'Neill, (2009) The investment decision making of
irrelevance information effect on investment negatively, on the basis available information
risk taking behavior of investor about particular security change the decision.
Paruchuri&Misangyi (2018) when financial market of reveal the mistreatment. The
investors of particular firms stock to get negative indication quickly and jump on the
conclusion.
Scharfstein & Stein, (1990) the sometime investors without taking decision of consideration
the right and relevant information of firms and stock.
Simon,Pelled,& Smith, (1999) the investment decision making nature of investors are
attentive and available information of investors should consider more.
Mitchell,Smith,Seawright, & Morse,(2000) the bias of very culture to culture and
collectivity or individual impact on psyche. Personality of investors and efficiency are
different culture are not a like.

Loss Aversion Bias on Investment Decision Making

First of all the actual concept of loss aversion first time to give in two psychologists Daniel
the investor’s preferences change according to available information and the division
manager is biased toward larger investments under certain conditions the average investment
will be smaller when the decision is delegated.
Harris & Raviv, (2005) Investment decision making of loss aversion of the analysis of the
investors feels less and they feel satisfaction of gain.
Rabin, (2000) the small investment of investors behavior cannot be valuable of loss averse
and the environment does not change effect the decision of loss averse investor and particular
loss aversion parameter is similar to different choice of environment.
R, Hassan, Wajiha, Khalid &Habib, (2014) The analyses of research impact on the cultural
values are effect on the cognitive biases investor’s and Pakistani men more overconfident
compare to women and Pakistani women are more low averse.
Blavatsky&Pogrebna, (2008) the British television vision to said that deal or no deal do not
become a less risk averse to facing large gains of small probability and the individuals are
not inclinable to lower risk aversion when dealing with large improbable gains.
Gachter, Johnson, & Herrmann, (2007) the financial knowledge of investor to decrease the
loss aversion up to extent and high wealth or high income of investor significant linked with
loss aversion.
Kahneman, Knetsch& Thaler, (1991) the investment decision making on loss aversion to
does not affect all transactions and normal commercial transaction to the seller does not
suffer a loss when trading a good. The indicates that buyers do not value the money to spend
of the normal purchase as a loss, so long as price of good is not through to be ordinarily high.
Abdellaoui, Bleichrodt, & Paraschiv, (2007) the fact that people are risk unwilling in the
area of increases, loss aversion does not depend on utility curvature and their definition
allows a decomposition of risk attitude into three distinct components: utility curvature,
probability weighting, and loss aversion.
Kermer, Driver, & Wilson, & Gilbert, (2006) the individual’s investor as to trend the
losses as much too possible of acquire gains. And this may lead people to make decisions that
maximize neither their wealth nor their happiness.
Benartzi & Thaler, (1995) it seems impossible to adjust the high rates of return on stocks
with the very low risk free rate. In model of investors are unwilling to accept the variability
even if the short run returns have no effect on consumption.
Heidhues & koszegi (2008) the analysis to this study more of customers have correct price
expectations which predict reduced price variation in a number of senses, there often seems
to be excess price variation between even identical products.
Overconfidence Bias on Investment Decision Making
The overconfidence of the financial behavior to markets is typically by overestimate of the
average rate of return from collection and overconfidence in success of innovation facilities
of additional acceptance in both the encouragement and the investment decision making
whereas during execution and confirmation, the best practice is developing into a real time
alternative rather than estimated event.
Javed, Bagh, Razzaq(2017) the research studies are suggested to incorporate the data
collection from individual and institutional investors separately in order to demonstrate
differences and the overconfidence to improve the reliability of results and to increase the
generalizability.
Chaudhary (2013) the behavioral finance of provides explanations for why investors make
irrational investment decision.it investors emotions and cognitive errors influence investors in
the investment decision making process. The overconfidence, people’s behaviors are over
and under reaction and loss aversions.
Raut, Kumar (2018) the investment decision on overconfidence process of individual
investors who are considered irrational. The biases not only impact the decision-making of
less-experienced and less confident investors but also the market professionals or experienced
investors.
Farsi, Nouri, Kafeshani, Toghraee (2014) the Overconfidence is a common decision
making bias among individuals and groups. The Overconfidence generally, in the field of
psychology, overconfidence is a difference between accuracy and probability. The mostly
Psychology of investor indicate that psychological and motivational factors as the main
causes of overconfidence.

Park, Bin Gu, Kumar, Raghunathan (2010) The analysis takes a first step to understand
how investors’ information processing behavior influences their trading frequency,
investment performance, and expectations. Investors are known to demonstrate behavior
biases in investment decisions making.
Soll and Klayman (2004) the investigated that having appropriate confidence was important
for making appropriate risky decisions, for knowing when to seek advice and information,
and for communicating one’s knowledge.

Ben-David,Graham,& Harvey, (2007) the overconfidence in analytical success of an

innovation facilitates additional acceptance in both the encouragement and decision stages
when predictions are most likely to occur, whereas during implementation and confirmation,
the best practice is evolving into a real time alternative rather than forecasted event.

Kahneman and Tversky, (1979) the factors such as self-commitment to the project and self-
declaration of aptitude are the reasons of overconfidence in an investor. When individuals fail
to understand the doubt of their capabilities fully, overconfidence tends to increase.

S.Devi, Karthikeyan (2018) the individual investors do not always act rationally while
making investment decisions. Individual investors suffer from several psychological and
emotional biases. The impact of behavioral factors on investment decision making leads to
irrational decision, loss and make investor not to invest in future.
1.3 Rationale of the Study

Our research will contributes to the literature on satisfaction the relationship between
availability bias, overconfidence bias, low aversion bias on investment decision making. This
study will provide a context for the relationship between the four variables, how they
communicate with each other. A conceptual method describe the impact of availability bias,
overconfidence bias, low aversion bias on investment decision making toward investors
behavior. Also we will Understanding the process by which availability bias, overconfidence
bias, low aversion bias on investment decision making from the investors risk perception of
environment may provide a rationale for a better understanding of investor’s behaviors of risk
taker yes or no to the investment decision making.

1.4 Objectives
The broad objectives of the present studies are:

 The impact of availability bias on investment decision making towards

investors.
 The impact of overconfidence bias on investment decision making towards
investors
 The impact of low aversion bias on investment decision making towards
investors
 To find out underline factor of the variables to be analysis.

1.5 Hypothesis

H1: Availability Bias is significantly and inversely associated with investment decision

Making.

H2: Overconfidence bias is positively associated with the investor’s decision.

H3: Loss aversion is associated positively with investment decisions

.
 Availability
Bias

Investment
Overconfidence
Decision
Bias
Making

Loss aversion

Figure 1

 Figure 1. Conceptual model of the availability bias, overconfidence bias, low

aversion bias on investment decision making.
 The Bold Lines indicate the relationship of constructs in the structure.
2. RESEARCH METHODOLOGY

The present research is a cross sectional study with descriptive nature, as research has already
been conducted in this area. Moreover it is a casual type of investigating. Data and sample
will be collected for the questionnaire using convenience sampling, from Securities and
Exchange Board of India and business investors. The population of this study was all the
people who are above the age of 18 years having well educational qualification and
experienced of encountering the decision making.

2.1 The study

The study was descriptive in nature. It would be examining the causal relationship
between the dependent variable (investment decision making) and independent
variable availability bias, overconfidence bias, low aversion bias.
2.2 The sample design

The sample design is a framework, or road map, that serves as the basis for the
selection of the survey sample and affects many other important aspects of a survey as
well.

2.3 Population
For the purpose of study the data was collected from investors of Gwalior region.
2.3.1 Sample size
The data will be collected from 200 respondents.
2.3.2 Sample Element
All the investors to invest money in stocks were for collecting data
2.3.3 Sampling Technique
Non probability purposive sampling method was use for collecting the data.

2.4 Tools used for data collection

The data was collected using standardized questionnaire. The responses were recorded using
five point Likert type scale. The anchors used in the questionnaire was range from strongly
disagree to strongly agree (where 1 = strongly disagree, 5 = strongly agree).
2.5 Tools for data analysis

 EFA (Exploratory Factor Analysis) is a statistical method used to uncover the

underlying structure of a relatively large set of variables. EFA is a technique within
factor analysis whose overarching goal is to identify the underlying relationships
between measured variables.
 Reliability For our questionnaire survey I adopt it which has been already used in much
research survey. Our questionnaire is more reliable in each other which show the
statistical reliability of scale. Ensuring the reliability of the research instrument is vital
for the authentication of the results. In order to conduct the full survey, researchers first
carried out the pilot testing for ensuring the reliability of the instrument and then
conducted the complete survey on the basis of the results of reliability testing.

 Multiple Regression is an extension of simple linear regression. It is used when we
want to predict the value of a variable based on the value of two or more other
variables. The variable we want to predict is called the dependent variable (or
sometimes, the outcome, target or criterion variable). The variables we are using to
predict the value of the dependent variable are called the independent variables (or
sometimes, the predictor, explanatory or regression or variables).
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Questionnaire

We are (Sachin Bandil, Mirinalini Upadhay student of MBA 3rd Sem. of Prestige
Institute of Management, Gwalior. I express our sincere gratitude to Prof. Shaifali
Chauhan for giving us the opportunity to Work under her guidance on the research Paper
report entitled “Impact of availability bias, overconfidence bias, low aversion bias on
investment decision making “are undergoing a research project you are requested to
finally fill the questionnaire on a scale 1 to 5 where,
 1 Indicates minimum agreement and
 5 indicates maximum agreement

The details collect through the questionnaire will solely be used for academic
purpose.
Name:-
Gender:-
Age:-
Qualification:-
Investment:-

Part1
Availability Bias

1. I prefer to invest in stock which has been evaluated by well-known expert.

1 2 3 4 5

2. My investment decision depends on new and favorable (positive) information

released regarding the stock.
1 2 3 4 5

3. If someone had told me that a financial crisis is about to happen in a years’ time. I
would be Convince.
1 2 3 4 5
 4. I prefer to buy stocks on the days when the value of Index increases.

1 2 3 4 5

5. I prefer to sell stocks on the days when the value of the Index decreases.

1 2 3 4 5

Part 2
Overconfidence Bias

1. Thinking hard and for a long time about something gives me little satisfaction.

1 2 3 4 5
2. I trust my initial feelings about people.

1 2 3 4 5

3. I prefer to do something that challenges my thinking abilities rather than something

that requires little thought.

1 2 3 4 5
4. I try to avoid situations that require thinking in depth about something.

1 2 3 4 5

5. When it comes to trusting people, I can usually rely on my "gut feelings".

1 2 3 4 5

6. I don't like to have to do a lot of thinking.

 1 2 3 4 5

7. I can usually feel well when a person is right or wrong even if I can't explain how I
know.

1 2 3 4 5

8. I prefer complex to simple problems.

1 2 3 4 5

Part 3
Low Aversion Bias

1. I am risk averse.

1 2 3 4 5

2. If I have to invest in less risky alternative.

1 2 3 4 5

3. If I lost money in this game then I will stop game doing more.

1 2 3 4 5

4. If I have less saving risky investment option.

1 2 3 4 5

5. I am hopeful when undertaking investments that have exhibited a sure loss.

1 2 3 4 5
 6. I have knowledge to invest my capital in business.

1 2 3 4 5

7. I am cautious about losses which show sudden changes in price or trading activity.

1 2 3 4 5

8. My decision in businesses largely based on knowledge, experiences and education.

1 2 3 4 5

9. I usually have investing in capital that has a past positive performance in trading.

1 2 3 4 5

Part 4
Investment Decision

1. I know about interest rates, Finance charges, and credit terms.

1 2 3 4 5

2. Money is most important goal of my life.

1 2 3 4 5

3. I know how to manage the finances.

1 2 3 4 5
4. I know how to invest my money.

1 2 3 4 5

5. It is more satisfying to save than invest money.

1 2 3 4 5

6. I would invest a large sum of money in stock.

1 2 3 4 5

7. The uncertainty of whether the market will rise or fall keeps me from buying Stocks.

1 2 3 4 5

8. I budget my money very well.

1 2 3 4 5