Affect of Investor's Financial Literacy on Investment Decisions

Financial literacy is one of the important concepts of investment decisions, it is the ability to understand how money works in the world, how someone manages to earn to make it, In this research study able to find out the person who are individual or family person who invested money from various investment avenues, whether the person to like the risk or not. The key objective is to explore the literacy level of individual in investment decisions and to suggest sustainable measures of increasing the awareness level. The study covered the 200 investors residing in the area of Chennai (Tier-1) and Trichy (Tier-2). Primary data were collected by administering a questionnaire. Primary data collected were analysed with help of SPSS package by using statistical techniques like percentage analysis and ANOVA single factor. From the analysis, it is found that the majority of the investors are below 40 years of age and 83.5% investors are graduates. The study reveals that many individual investors had entered into the market but only half of them have financial literacy. Investors are facing difficulties in selecting the investment avenues. Majority of the investors prefer to invest in shares, bank and gold. In stock market, volatility of stock results in risk for investor and at that time investor sell the stocks and move to various investment avenue like real estate and gold. The financial literacy of the investor is influenced in the help of the financial information from Advertisements, media, friends and best buy guidance.