Investors Investment Decision making criterion of Individual salaried person

Abstract

Investing is a financial activity that provides a wide array of options for individuals looking to grow their wealth. Recent trends show that investors exhibit highly dynamic behavior, which is influenced by a multitude of factors related to investments. These factors impact individual investors based on their investment goals, perceptions, attitudes, and expectations regarding risk and returns. This research delves into investment guidelines tailored for various types of organizations, each characterized by distinct residual claim attributes. Varied limitations on residual claims result in different decision-making principles. The analysis suggests that open corporations, financial mutual funds, and nonprofit organizations can be modeled using the principle of maximizing value. However, this principle may not generally apply to proprietorships, partnerships, and closed corporations. The primary drivers affecting individual investment decision-making are financial and geographical considerations. Therefore, this study aims to identify the factors influencing individual investment choices and explore gender-based disparities in investors' perceptions when making investment decisions. The study concludes that the risk appetite of investors predominantly shapes their investment decisions. In this research, we apply the Technique for Order of Preference by Similarity to Ideal Solution (TOPSIS) method to assess investment options tailored for salaried individuals. We systematically examine six critical criteria: Return on Investment (ROI), Liquidity, Risk, Lock-in Period, Tax Implications, and Initial Investment Amount. Our analysis covers five investment choices—Stock Market, Real Estate, Fixed Deposits, Mutual Funds, and Gold. The findings indicate that Stock Market emerges as the top choice due to its strong performance in terms of potential returns and risk management. Mutual Funds and Gold closely follow suit. Fixed Deposits and Real Estate, while still viable options, hold lower rankings primarily due to specific trade-offs. This study provides a structured approach for individuals to make informed investment decisions, taking into account their distinct financial objectives, risk tolerance, and available resources.