Factors affecting the investors decision making: A theoretical review of literature and the scenario from a developing country

2. Presentation on
Factors affecting the investors decision making
A theoretical review of literature and the scenario from a
developing country
Presented By
Md. Assad Uddin
ID: 1402010002
BBA Program
School of Business
Britannia University
Supervisor
Md. Alam Shikdar
Lecturer
School of Business
Britannia University

3. Introduction
• Objective of the study
• Scope of the study
• Limitations of the Study

4. Objective of the study
• To determine if the identified
factors influence investors
decision making in the share
market

5. Limitations of the Study
• Lack of Information
• Lack of knowledge and
experience among the
targeted population

6. Literature Review

7. Theoretical Overview

8. Investor
• An investor is any person who commits capital
with the expectation of financial returns.

9. Investors Decision

10. Factors affecting Investors Decision
making
• Investment returns and economic conditions
• Self-Image/Firm Image
• Psychological factors
• Advocate recommendations

11. Investment returns and economic
conditions
• Price movements
• Dividend policy
• Returned on Investment (ROI)
• Corporate earnings
• Stock Price

12. Self-Image/Firm Image
• The Past Performance
• Company Goodwill

13. Psychological factors
• Risk factors

14. Advocate recommendations
• Agents Advice or Brokers Recommendation
• Media & Internet

16. Sources of data
Primary data Secondary Data

17. Methodology
Sampling Method: Random Sampling
Sample size: 44 respondents (i.e., investors)
11 Variables: 10 Independent and 1 Dependent
Questionnaire: Self-administered
Scaling: 5-point Likert scale

18. Hypothesis
• Null Hypothesis (H0):
Investment factors do not have any
influence on the decision making behavior
of investors of Bangladesh.
• Alternative Hypothesis (H1):
Investment factors have influence on the
decision making behavior of investors of
Bangladesh.

19. Code Factors affecting investors decision making 1=SD 2=D 3=N 4=A 5=SA
F01 Price Movement of the company stock affects my investment
decisions
1 2 3 4 5
F02 Past financial performance is an important factor that affects my
investment decisions
1 2 3 4 5
F03 Company goodwill affects my investment decisions 1 2 3 4 5
F04 A company’s dividend policy is an important factor that affects my
investment decisions
1 2 3 4 5
F05 Earnings of the company plays an important role in my investment
decision
1 2 3 4 5
F06 Return on Investment is an important factor that affects my
investment decisions
1 2 3 4 5
F07 Level of risk in the market is an important factor that affects my
investment choices
1 2 3 4 5
F08 Trends in the general price level affects my investment decisions
1 2 3 4 5
F09 Publicly available information on websites, media etc. affect my
investment choices
1 2 3 4 5
F10 Recommendations from agents or stock broker’s affect my
investment choices
1 2 3 4 5

20. Analysis & Findings

21. Reliability:
Cronbach’s Alpha .513 on 11 items (Acceptable i.e., >0.50)
Validity:
Kaiser-Meyer-Olkin (KMO) Measure of Sampling Adequacy is:
.501 (0.5 – 0.8 ‘good’)
Bartlett’s Test of Sphericity is:
 approximate chi-square 89.826 with 55 df [significant]
Summary:
Variables are correlated. Samples are adequate. So:
 the null hypothesis that the variables are uncorrelated is rejected

22. Result of Correlation Analysis
The positive values of Correlation rejects the null hypothesis (H0) that
“Investment factors do not have any influence on the decision making
behavior of investors of Bangladesh”
&
Proves or accepts the alternative hypothesis (Ha) that “Investment factors
have influence on the decision making behavior of investors of
Bangladesh”
So, it is statistically proved that there is a relationship as expected.

23. Recommendations