A Study of the Effect of Income of Investors on Preferred Investment Avenues

Income of investors can be considered as one of the most important factors that has influence on investment decision. In economics, the fluctuations in income can affect demand in the market as it directly influence purchasing power and investible surplus of investors. The study was undertaken to understand the possible effect of income of investors on various investment avenues. A sample of 974 individual investors was surveyed through a self designed questionnaire having six investment avenues i.e., variable income, fixed income securities, deposits, tax sheltered, mutual fund, insurance and real asset. One-way Anova was applied to check statistical differences among various income levels regarding investment avenues. The result found that income levels differed with respect to variable income securities, fixed income securities, deposits, tax sheltered investment alternatives, insurance and real asset. Only mutual fund was not found significant with respect to income levels because investors were found almost similar their views as far as mutual fund is concerned. Hence, it can be concluded that, at different level income investors have different choices of investment alternatives.