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- Title
A fuzzy analytical hierarchy process framework for stock selection in the Indian stock market.
- Authors
Jain, Jinesh; Walia, Nidhi; Gupta, Sanjay; Aggarwal, Kriti; Singh, Simarjeet
- Abstract
The present study aims at ranking the various factors which affect the stock selection decisions of retail investors in the Indian stock market. Further, the research provides valuable insights into the different factors that affect the stock selection decisions of the equity investors. For this purpose, the data were collected from 168 retail equity investors dealing in the Indian Stock Market. "Fuzzy Analytic Hierarchy Process" was applied to rank the various factors affecting the stock selection decision of Individual equity investors trading in the Indian Stock Market. The primary factors considered for the study are accounting information, ownership structure, company‐specific attributes, image of the company/board of directors, fundamentals of stock, trading opportunities, and sensitivity of stock and behavioral factors. The findings of the study revealed that behavioral factors, trading opportunities, and accounting information were the three most influential criteria. The five most influential sub‐criteriums were, "I invest in those stocks which are affordable in terms of price (C52)," "I invest in the company's stock based on the recent price movement of stock (C51)," "I select the stock based on the sensitivity of company's stock performance to overall market performance (C62)," "I invest in the stock based on the trend of major indices (C61)," and "I prefer to invest in stocks which are evaluated by well‐known experts (C80)." The present research has been carried out on a limited sample size which truly represented the total population; still, it is considered as the limitation of the study. The outcome of this research will provide investors with a better understanding of various factors that influence their stock selection decision. The study provides them a guideline on different factors; they should take into consideration, while undergoing the stock selection decision. The present research study enriches the literature on behavior finance from emerging markets.
- Subjects
ANALYTIC hierarchy process; STOCK exchanges; BUSINESS enterprises; STOCKS (Finance); INDIVIDUAL investors
- Publication
Journal of Public Affairs (14723891), 2022, Vol 22, Issue 4, p1
- ISSN
1472-3891
- Publication type
Article
- DOI
10.1002/pa.2710