Behavioral Biases and Investment Decision-Making Patterns: Evidence of Young Investors from Chitwan District

Abstract

This study is based on the theoretical framework of behavioral finance, prospect theory, and social learning theory. It evaluates the combined effect of financial literacy, investor education, and information on investment decisions among young investors from Chitwan district.  The descriptive and causal research design has been used. The data has been collected from 384 investors and analyzed using descriptive, correlation and regression analyses. The study has identified social influence, decision-related factors, and financial literacy as the most significant determinants for investment decisions among young investors. Moreover, it reveals that young investors use a combination of personal knowledge, peer group influence, and access to information to make investment decisions. This study has provided substantial theoretical support for the behavioral finance theory and social learning theory. Finally, this study has provided substantial practical implications for developing rational and sustainable investment behaviors among young investors in emerging markets.