Impact of Demographic Factors on Investment Risk Tolerance

Abstract

The study aims to investigate the impact of demographic factors on investment risk tolerance. The demographic variables taken include age, gender, marital status, income, work experience, and education. The primary data has been collected through questionnaires by adopting a deductive approach. The sample size consists of 106 respondents using convenience sampling. SPSS is used for data analysis and person correlation, and linear regression is applied to analyze the relationship between the variables. It was identified that gender, income, and education are positively related to risk tolerance level, whereas age, marital status, and work experience are negatively related to risk tolerance. Gender is found to have a significant positive impact on risk tolerance level, whereas marital status has been found to have a negative and significant relationship with the risk tolerance level of individuals. These findings will be helpful for the investors to improve their investment decision-making skills. The further risk tolerance of investors may depend on the behavioral factors too.