Exploring Snakebite Effect and Risk Perspectives in Investor's Decision-Making in Stock Market of India
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Abstract: This paper explores behaviour of individuals taking re-investment decisions in the stock market attributable to snakebite and house money effect. It also attempts to study if variables like age, gender, education and experience contribute to exhibiting such behaviour. It was a primary study covering 454 investors who responded the survey during 2021. The data analysis proved prevalence of irrational behaviour in re-investment decisions of the respondents. The investors were found either risk seeking or risk averse depending on earlier gain or loss across gender, age and education However, a contradiction was observed in the behaviour of the experienced investors.
Keywords: Snakebite Effect, House Money Effect, Re-investment Decisions
JEL Classification Number: G4, G11
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