A

Project Report
On

“A STUDY ON FINANCIAL LITERACY OF

INVESTORS IN AHMEDABAD CITY”

Presented by:
Name Enrollment No.

Harshil Zaveri 202000510010383

Matiksh Trivedi 202000510010357

Under guidance of
Prof. Dr. Darshna Khakhar
 Content

01 INDUSTRY OVERVIEW

02 FINANCIAL ITERACY

03 LITERATURE REVIEW

04 RESEARCH METHODOLOGY

05 DATA ANALYSIS AND INTERPRETATION

06 FINDINGS

07 CONCLUSION
 INDUSTRY OVERVIEW
The Indian financial sector is a pillar of the nation’s economic
development, fostering investment, innovation, and inclusive growth.

The Indian financial sector is a dynamic and rapidly evolving

component of the country’s economy, with significant implications for
economic development, investment and financial inclusion.

It comprises a well-developed banking system, capital markets,

insurance, pension funds, and non-banking financial companies
(NBFCs).

Over the years, the sector has undergone significant reforms to

enhance stability, efficiency, and global competitiveness.

With more digitalization, regulatory changes, and foreign investments, India is

on track to become a global financial powerhouse in the coming years.
 POTER’S FIVE FORCE ANALYSIS

THREAT OF NEW BARGAINING POWER OF BARGAINING POWER OF

ENTRANTS SUPPLIER BUYERS

• Regulations • Capital Providers

• Capital Requirement • Technology Providers • Cost Sensitivity

• Brand Loyalty • Human Resources • Switching Cost

• Threat Level • Supplier integration

THREAT OF SUBSTITUTE COMPITITVE RIVALRY

PRODUCT WITHIN THE INDUSTRY

• Number of Competitors
• Fintech and Digital Platforms
• Innovation and Technology
• Alternative Investments
• Market Saturation
• Government Initiatives
 FINANCIAL LITERACY

Financial literacy is an essential life skill that empowers

individuals to achieve financial stability, make smart
investment decisions, and secure their future.

Financial literacy refers to the ability to understand and

effectively manage personal finances, budgeting, saving,
investing, and making informed financial decisions.

It lays the foundation for a smart relationship with money,

guiding lifelong learning in advanced financial matters.

With rising economic complexities, being financially aware

helps people avoid financial stress, grow wealth, and
achieve their financial goals.

In today’s fast-paced and digital economy, financial

literacy is more crucial than ever, helping individuals
navigate economic uncertainties and make informed
financial choices.
LITERATURE
REVIEW
 AUTHOR OBJECTIVE

The study assessed financial literacy (FL) levels and their impact on investment decisions among investors in Ahmedabad and
Shroff, Sumita Jagdish Prasad Vadodara, Gujarat. FL was measured through financial behavior, attitude, and knowledge, while investment decisions were analyzed
(2024) using six key factors. Results showed that 62.5% of respondents were highly financially literate, though they lacked advanced
investment knowledge. Simple linear regression confirmed a significant positive impact of FL on investment decisions..

The study examines citizens' awareness of mutual funds in Ahmedabad, Gujarat, using primary data from 100 respondents through a
Shivam Tripathi (2020) questionnaire. Despite awareness, many do not invest in mutual funds. The findings can help develop strategies to boost mutual fund
investments and increase awareness in India.

The study evaluates financial literacy among salaried females in Ludhiana and its impact on investment decisions. Using a
questionnaire, data was collected from 100 respondents through non-probability convenience sampling. The research highlights
Ravneet Kaur (2020)
financial literacy’s influence on financial behavior and suggests expanding the study to compare different demographics or explore
its role in women's empowerment. It also proposes extending the study to other regions for broader insights.

The study examines factors influencing investor behavior in Gujarat's investment market. Based on a sample of 150 investors using
non-probabilistic convenience sampling, exploratory factor analysis identified three key factors affecting investment decisions:
Dr Nilam Panchal (2023)
Company Profiling, Herding Bias, and Risk Awareness. The research highlights biases investors face and provides insights into their
decision-making process.
RESEARCH METHODOLOGY
 OBJECTIVES

To assess the
To identify the
To study the impact of financial
challenges faced by
financial literacy literacy on
investors in acquiring
levels of the investment
financial knowledge
respondents. performance and
and making informed
risk-taking behavior
investment decisions.
among investors.
RES EA RCH D ES I G N DATA A NLYSI S T O O L

This research is
based on  MS Excel
descriptive  SPSS
research method.
 DATA COLLECTION METHOD

PRIMARY SECONDARY
COLLECTION COLLECTION

 Research papers
 Structured  Articles
Questionnaire  Books
 Journals
 SAMPLING PLAN AND TECHNIQUE

SAMPLE SAMPLING SAMPLING

POPULATION
SIZE FRAME TECHNIQUE

Investors in Non - Probability

Ahmedabad City 202 18 yrs or above Convenient Sampling
Technique
DATA ANALYSIS
AND
INTERPRETATION
 Age
Above 60
46-60 3%
15%
18-25 18-25
34%
26-35
36-45
1. Age 36-45 46-60
16% Above 60

26-35
32%

Gender

Female
2. 31%
Gender
Female
Male

Male
69%
 Education level
Undergrad-
uate
15%

Post Graduate
3. Education Level Professional Degree
Undergraduate

Professional
Degree
23% Post Graduate
62%

Occupation

Business
Salaried 36%
4. Occupation 42% Business
Professional
Retired
Salaried

Retired
1% Professional
22%
 Annual Income
Below 2 lakhs
5%
Above 20 lakhs 11-20 lakhs
10% 23%
11-20 lakhs
5. Annual Income 2-5 lakhs
6-10 lakhs
Above 20 lakhs
Below 2 lakhs

6-10 lakhs
36% 2-5 lakhs
26%

How would you rate your financial knowledge?

100
90 87
80
6. How would you rate your 70 67
financial knowledge? 60
50
40
30 25
19
20
10 4
0
Very low Low Average High Very high
 How often do you follow financial news or market trends?
80
73
70 66
60
7. How often do you follow 50
financial news or market 40 36
trends? 30 25
20
10
2
0
Daily Weekly Occasionally Rarely Never

What factors most influence your investment decisions?

82
80
58
60
40 34
20
20 8
8. What factors most 0
influence your investment
decisions?
 What do you consider your biggest obstacle to making informed
investment decisions?
116
120 93
80
80 51 54 49
40 33 32 19
0

9. What do you consider your

biggest obstacle to making
informed investment
decisions?

What do you find most challenging about understanding in-

vestment strategies?
120 109
86 79
80 65
40 33
0
10. What do you find most
challenging about
understanding investment
strategies?
 How often do you review your investment portfolio?
120
104
100

80
11. How often do you review 63
your investment portfolio? 60

40
25
20
3 7
0
Weekly Monthly Quarterly Annually Rarely

How would you describe your current investment performance?

160
140 134
120
12. How would you describe 100
your current investment 80
performance?
60
40 32
24
20 12
0
Below expectations As expected Above expectations No idea
 How would you rate your risk tolerance when making in-
vestments?
120 102
80 71
40 24
5
0

13. How would you rate your

risk tolerance when making
investments?
 Factors Mean

I am confident about my financial knowledge. 4.06

I am confident in making financial and investment decisions. 3.93

Spending money gives me more satisfaction than saving it for the long term. 2.55

14. To which extent you agree

with the following statements I usually think about the ways to reduce my Spending. 4.06
related to your financial
attitude.

I know the sources from where I can get financial information. 4.00

I have the ability to deal with the banks/ financial service providers. 4.10

Making risky decisions will add more values to my return. 3.03

 Factors Mean

The cost of living increases due to high inflation. 4.148515

Interest will influence the future value of savings. 3.920792

15. To which extent you agree

with the following statements Investment in stock market is the riskiest of all investments. 3.415842
related to your financial
Knowledge.

Risk can be reduced through investing in wide range of assets. 3.574257

An investment with high return is likely to have higher than average risk. 3.925743
 Factors Mean

I always participate in household decisions. 4.014851

I usually make household budgets. 3.792079

I always make proper documentation / records of financial matter. 4.049505

16. To which extent you agree

with the following statements
related to your financial I set my financial goals very clearly. 4.183168
behavior.

I always set aside money for future emergency. 4.123762

Before buying anything I compare the prices. 4.282178

I usually check my paying capacity before purchasing anything. 4.252475

 HYPOTHESIS TEST SIGNIFICANCE RESULTS
H0: here is no significant
association between age and
investment risk tolerance.
H1: here is significant association CHI – SQUARE 0.114 > 0.05 Accepted
between age and investment risk
tolerance.

HYPOTHESIS H0: There is no significant

TESTING association between age and

financial knowledge level.
H1: There is significant CHI – SQUARE 0.088 > 0.05 Accepted
association between age and
financial knowledge level.

H0: There is no significant

association between annual
income and investment risk
tolerance. CHI – SQUARE 0.000 < 0.05 Rejected
H1: There is significant association
between annual income and
investment risk tolerance.
 FINDINGS
Objectives Findings
 Most respondents feel confident in their financial knowledge, influenced
by education, information access, and investment experience.
 A strong majority (69%) actively track financial updates, aiding
To study the financial literacy levels of the respondents. informed decisions.
 Most acknowledge inflation's impact, interest in savings, and
diversification benefits. While stock market risk views vary, many link
higher returns to higher risks.

 Investment decisions are mainly driven by recommendations and

market trends, with minimal emotional influence.
 Most respondents are satisfied with their investment performance,
To identify the challenges faced by investors in acquiring
though some face challenges due to market fluctuations.
financial knowledge and making informed investment  Lack of knowledge is the biggest hurdle, followed by fraud concerns,
decisions. low confidence, and high costs.
 Risk tolerance varies, with most opting for moderate risk, some
preferring low-risk, and few taking high risks.

 Most prioritize long-term savings, expense reduction, and financial

literacy, feeling confident in handling financial services.
 Many are cautious with risk, questioning its direct link to higher
To assess the impact of financial literacy on investment returns.
performance and risk-taking behavior among investors.  Active in household finances, they set goals, save for emergencies,
and compare prices before purchases.
 Annual financial reviews reflect planning and responsibility, reinforcing
financial awareness and competence.
 CONCLUSION

This study has shed light on the investors in Ahmedabad actively monitor their
investments, gaps persist in risk assessment, independent decision-making,
and access to reliable financial advice.

Through comprehensive analysis and research methodologies, it has

become evident that structured programs should be tailored for different
demographics, especially women and middle-income earners, to enhance
financial knowledge and decision-making.

This study serves as a valuable resource for that regulatory bodies and
financial institutions should make investing easier, improve fraud awareness,
and provide accessible expert guidance to boost investor confidence.