International Research Journal, October 2010, ISSN- 0975-3486 RNI : RAJBIL 2009/30097 VOL I * ISSUE 13

Research PaperCommerce

INVESTORS BEHAVIOR TOWORDS SHARE MARKET

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(A Study of Dhar district of Madhya Pradesh) * Prof. Sohan Patidar

October, 2010

* Deptt. of Commerce Shri Ambika Adarsh Mahavidhyalaya Badnawar ,Dhar (M.P.)

INTRODUCATION :Investment are the amounts which are invested as capital or some securities of public or private sector for earning income. The amounts which are invested without the project of earning money, are either donation or assistance.The concept of investment means employment of funds to earn additional income or growth in term of value. The essential quality of an investment is expectation of reward. It involves the commitment of resources which have been saved from current consumption in the hope that some benefits will be received in future. SHARE MARKET :-A person can invest his money in the share market by purchasing shares. A share market is a public institution and it serves the growth of the capital market. It is the most perfect type of market for securities, whether the share are of government and semi-government bodies or other public bodies, as also for share and debentures issued by the joint stock companies. In the stock market, purchase and sale of share are made in conditions of free competition. It is organized as voluntarily, non-profit making association of brokers to regulate and project their interests. Government securities are traded outside the trading ring in the form of over all counter sale or purchase. whenever a company raises capital through public issue of securities, its securities are required to be listed on the stock exchange within ten weeks of the closing of the subscription list mainly to provide liquidity to the investors. OBJECTIVES OF STUDY :- 1. To study the Behavior of investors towords share market in the Dhar district.2. To analysis the attitude of investors in the study area. 3. The purpose of this research paper is to study the decision process of investors. HYPOTHESIS :- 1. Investing has been an activity confined to the rich and business class. 2. There is no significant association between age and investent. METHODOLOGY:- The study was based on a sample
RESE ARCH AN ALYSI S

survey of individual investors in the security market. The data used are the first hand information collected with the help of questionnaire form the set of respondents.The sample size for this survey was 80. The views are conducted in the month of April to July 2010. The investors were interviewed in Dhar district. The analysis of the overall status of the investors and their behavior in the district is based on the primary data. The secondary data and information were obtained from the various journal, magazines, books and internet sources. STUDY AREA :- The Dhar district is situated in the west part of Madhay Pradesh. District lying between 2200 and 2310 N latitude and 7428 and 7542 E longitude. Total geographical area of the district is 8153 sq. kms. Comprising of 1474 villages. and having 1740329 population as per the 2001 census.The density of population in the district was 213 per sq.km. The average annual rainfall is 640.60 mm.(2008-09), Mostly from the south west monsoon. It is surrounded by Jhabua district in the west, Barwani district in the south , Khargone district in the south east, Indore district in the east and Ujjain district in the north east, Ratlam district in the north. The district head quarter dhar is 65 k.m. away from indore which is economical capital of M.P. Dhar district is most papular for Pithampur industrial zone and its heritage zones Mandu and Bagh. RESEARCH AND ANALYSIS The research was based on questionnaire for collecting the data.The data were tabulated and analyzed so as to represent in a diagrammatic form in a simple manner. The age of the sample respondents is expected to relate with their experience in trading in security market.The distribution of age of the respondents is given in Diagram1.It could be seen that 31(38.75%) investors are between the age of below 35 years. 23(28.75%) investors are in the ages between 35-44. 17(21.25%) are in the ages between 45-54 and 09(11.25%) investors are in the age above55. It shows that the
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International Research Journal, October 2010, ISSN- 0975-3486 RNI : RAJBIL 2009/30097 VOL I * ISSUE 13 investors in the age group of below 35 years are acDiagram : 2 tively participating in the speculation trade and the Experience in Online Trading age group above 55 hesitate to take risk.The level of education plays very important role in the socio-eco23 25 nomic status of an individual. It also shows the status 19 18 20 of education. It is inferred from Diagram 2 that the 13 15 24(30%) investors have only higher secondary educa10 7 tion,18(22.5%) investors have completed graduation, 5 14(17.5%) investors have done postgraduation. The 0 Less than 2 More than 5 professional investors are 11(13.75%) who have pro2 to 3 years 3 to 4 years 4 to 5 years years years fessional degree.and 13(16.25%) investors are others. 18 23 7 13 19 No.of Respondents Source: Primary Data Experience (in year) Investment in share is also on the basis of income of the family. The investing ability may differ from person Diagram : 3 to person according to his earning capacity. Diagram 3 reveals the position of the investors.It is evident from Influencing Factors of Investment the Diagram that 32(40%) investors earn monthly in50 come less than Rs.20000. 25(31.25%) investors earn 43 40 income between Rs.20001-30000 per month, 10(12.5%) investors earn Rs.30001-40000 per month, 08(10%) in30 vestors earn Rs.40001-50000 per month and only 20 15 11 05(06.25%) investors are earn Rs.50000 above per 6 10 5 month. The experience of the investors in the share 0 Share Friends and market is another vital factor for the increasing public Newspapers Magazines Studies Brokers Relatives
No. of Respondents
No. of Respondents

Age-wise Classification
No. of Respondents 40 30 20 10 0
No. of Respondents Below 35 31 35-44 23 45-54 17

No.of Respondents

43

11

15

Avenues

31 23 17 9

More than 55 9

Age of Investors

awareness in choosing the effective channel for investing in the share market.It could be seen from Diagram 4 that 18(22.5%) investors have less than 2 years experience, 23(28.75%) investors have 2 to 3 years experience and only 07(08.75%) investors have 3 to 4 years experience,13(16.25%) investors have 4 to 5 years experience and 19(23.75%) investors have more than 5 years experience.Diagram 5 is shows that 43(53.75%) investors are investing his hard money through share brokers. 06(07.5%) investors are investing on the basis of newspaper information, 11(13.75%) investors are investing on the analysis of magazines, 05(06.25%) investors are investing on the basis of studies of share

market and 15(18.75%) investors are investing his money according to their friends and relatives advices. INVESTORS AWARENESS AND ATTITUDE :Investors behavior is influenced by many factors including social and psychological factors. It is an acceptable fact that the investors are the focal point to the security market. The behavior of investors is not a static one. It varies from place to place. It is how individuals act to obtain and use money and benefits including the decision process. It has been long since small investors have forgotten to go through the primary market. New issues from corporate have virtually come to a standstill over the last two years due to the adverse condition of the stock market. Now the small investors also fear to put their hard earned money in the secondary market. Due to a continuous fall in the interest rates all the savings schemes in banks, post offices, Non-banking Finance Companies and provident funds, the hard-earned money o the people is being eaten away by inflation. But the stock market is the place next to direct busiAND EVALU ATION

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International Research Journal, October 2010, ISSN- 0975-3486 RNI : RAJBIL 2009/30097 VOL I * ISSUE 13 ness where erosion of money due to inflation can be market.Investors falling under income group below avoided, if prudent investment decisions are taken. It Rs.20,000 show more interest in investing their earings is true that money can be doubled or tripled in a few in the share market.The 2 or 3 years experience holder days in the stock market. The task of earning profit investors are more interested find than another through trading in share is not very easy particularly investors.Mostly investors are investing his money for those who are not fully aware of the trading system through share brokers. Investing has been activity at stock exchanges. confined to the rich and business class in the past. But CONCLUSION :- The behavior of investors of Dhar today, It has become a household word and is very district has been analyzed. The findings of the present popular with people from all walks of life. The results study indicate that As per the age-wise classification, conclude that in todays era the person must think about the investors in the age group of below 35 years are future life. Even the individuals must leave with planactively participating in the speculation trade and the ning of finance for make their life become comfortable, age group above 55 hesitate to take risk. and are not at relaxable and luxuries todays man is also good invesall interested in the share market.Professional people tor becouse market gives him a lot of opportunities of are not interested to invest their money in the share investment.

R E F E R E N C E
1- An Introduction to Research Methods- Parasnath Roy, Laxmi Narayan Agrawal Publication, Agra 2- Financial Market Operations - Dr.V.P. Agrawal, Sahitya Bhawan Publication Agra 2008. 3- Company Law - Dr.S.M. Shukla & Dr. S.K.Sinha, Sahitya Bhawan Publication Agra 2008. 4- Financial Manageent - Dr. S.P. Gupta, Sahitya Bhawan Publication Agra 2008.5- Survey 2010
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