A STUDY OF INFLUENCE OF COGNITIVE BIAS AND EMOTIONAL BIAS ON INVESTMENT DECISIONS OF SALARIED EMPLOYEES IN AMRAVATI CITY

This study examines the influence of cognitive and emotional biases on the investment decisions of salaried employees in Amravati city. In today’s financial environment, individuals often rely on psychological factors rather than rational analysis while making investment choices. The main objective of the study is to analyze how cognitive biases such as overconfidence, herding behavior, and confirmation bias, along with emotional biases like loss aversion and optimism, affect investment behavior. A descriptive research design was adopted, and primary data were collected from 100 respondents through structured questionnaires. The data were analyzed using percentage analysis and presented through tables and graphs. The findings reveal that most respondents are influenced by market conditions and personal beliefs while making investment decisions. A significant number of investors show confirmation bias by preferring information that supports their existing beliefs. Emotional responses such as confusion, hope, and fear were also observed during market fluctuations. The study concludes that both cognitive and emotional biases play a crucial role in shaping investment decisions. These insights are useful for investors, financial advisors, and policymakers to promote better financial awareness and rational decision-making.