Abstract:

This study focused on the behavior of Bangladeshi investors in the local equity market. Investor invest in
equity market to increase their earnings or sometimes to increase their business operations for not only
keeping their business into boundaries but also to make more profit from their businesses. Role of
investors has a great impact on stock market as they are investing their savings. For solving financial
problems of the local equity market some decisions that are taken based on the behavior of investors
who invested in local equity market. Our project is based on some demographic factors such as
academic qualifications, marital status, age , gender, annual income , experience and thinking pattern of
investors before investing in the equity market. We have collected both primary and secondary data for
presenting a clear image of that factors which are effecting the equity market of Bangladesh. Response
of the investors and the factors which are affecting in investors decision making are the main findings of
our project.

Introduction:

Investment has a significant contribution to the economic growth and development of Bangladesh as it
is one of source through which is serving the needs of raising funds. Investment also improve
productivity of an economy .

Entering into equity market is one of the best ways of gathering funds as equity market play an
important role in financial market. In Bangladesh there are various promising firms such as garments,
food, energy, banks, pharmaceutical, information and technology in which investment can be held.
Firms have to follow some regulations before going into an equity market and firms sell their ownership
through trading their shares publically in the equity market. But the reason of going into an equity
market is to expand their business through gaining extra capital from equity market. As everyone
wanted to become rich as soon as possible using easy way but it is not an easy game to invest in equity
market.Investors have a lot of alternative to buy shares as they have information about all the listed
company shares. Investment in equity market will be profitable only when investors invest in right place
and right time.

Behavioral aspects of investors play an important role to earn profit from investment in to equity
market. Investment decisions of investors influenced by several behavioural factors. From analysis of
behavioral aspects of investors for investment will get some knowledge about how investors invest in
equity market and gain profit from it. Most influential for equity market condition depend on the
interest of investor's behavior. Before investing into equity market investors have to bring some issues
under consideration like financial capability of a firm , how much do they get from their investment ,
ability of risk taking of them, risk that are exist in a stock market how much investors are capable of
taking that kind of risks, analysis of alternatives which are available and some expert advices will guide
them . Other sources of collecting information like internet, talk show, news, different books or articles
investors might use to satisfy their own self at the time of buying shares. If wealth maximization is the
main goal of an investor so he will definitely go for high risk as wealth maximization related to high risk
and high return.
Most of investors are not rational especially in Bangladesh so perception of investors may differ. Some
investors who are rational will get return as per their wish through participating in decision making
process . Rational investors most of the time take complex decision that requires more effort and lead to
meet their desirable profit. On the other hand irrational investors as well as those investors who have
lack of knowledge about capital market will not be profitable from their investment because they invest
without having carefulness and consciousness. Reason that lack of sufficient information that investors
are getting and investors are following crowd decision with giving their private information.

Recently pandamic has created great damage in the economy of all over the world as well as share
market performance . Bangladesh stock market is not beyond that situation so it has also bear the
consequences of pandamic situation . Researchers focused on the behaviour of the investors towards
stock market because of uncertainty they found that investors behaviour is irrational in the financial
market that may cause abnormal gain as well as abnormal loss . Instead of using their own decision
investors have tendency to mimic other investors .

Demographic overview and other factors like earning capacity of investors through questionnaire it may
be easy way to understand investor’s behavior towards equity market. Also get some ideas about
various factors that are affecting investor’s decision making process through questionnaire.