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Journal for Studies in Management and Planning I SSN: 2 3 9 5 -0 4 6 3

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A Study On
Investment Preferences among Employees
With Reference To Kurnool City
DOWLATH AHAMMAD 1 , Dr. B.C. LAKSHMANNA 2

1
Research Scholar, Dept. of Management, Regd. No. PP MAN 0372, Rayalaseema University, Kurnool,
A.P., India
E-Mail: dowlath.mba@gmail.com

2
Professor & Research Supervisor, Crescent Institute of Management, Anantapur, India

Abstract:
Investment is the commitment of funds which have been saved from current consumption
with the hope that some benefits will be received in future. Savings are invested in assets
depending on person’s knowledge of different investment options, risk taking ability and
demand of return. Investors are investing their money with the different objectives such as
return, safety, security, appreciation, Income stability etc. Researcher has studied the different
areas of investments as well as the factors while selecting the investment with the sample size
of 100 salaried employees by conducting the survey through questionnaire in Kurnool City,
India. The study is based on personal interviews with salaried peoples, using a structured
questionnaire. Actually, the present study identifies the preferred investment avenues among
the individual investors using self assessment test. The study is based on primary sources of
data which are collected by distribution of a close ended questionnaire. The data has been
analyzed using percentage and chi-square test with the help of statistical software. The
researcher has analyzed that salaried employees consider the safety as well as good return on
investment with high liquidity on regular basis. Respondents are aware about the investment
avenues available in India.

Key Words: Investments, Investment Preferences, Avenues, Salaried Employees, Savings.

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Journal for Studies in Management and Planning I SSN: 2 3 9 5 -0 4 6 3
Available at Vol ume 0 3 I s s ue 0 1
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1. Introduction Avenue among them, depending upon her/his


Money plays vital role in everyone’s life. In specific need, risk preference, and return
order to future, People have to invest their expected. Investment avenues can broadly
money. Investment is the commitment of funds categories under the following heads.
which have been saved from current 1. Equity
consumption with the hope that some benefits 2. Bank Fixed Deposits
will be received in future. Savings form an 3. Provident Fund
important part of the economy of any nation, 4. Insurance Sector
with the savings invested in various options 5. Postal Savings-NSC
available to the people, the money acts as the 6. Gold/Silver/Precious stones
driver for the growth of the country. The prime 7. Real Estate
8. Mutual Fund
function of the Financial Market is to facilitate
the transfer of funds from surplus sectors 9. Chits & Others
(lenders) to deficit sectors (borrowers). All the above investment avenues, based
Normally, households have investible funds or on risk taking ability of the investor, can be
savings, which they lend to borrowers in the segregated as follows:
corporate and public sectors whose requirement  Low Risk Investments: Savings Account,
of funds far exceeds their savings. Economist Bank Fixed Deposits, Provident fund,
and policymakers have observed that Government Securities, etc.
demographic factors like age, gender, marital  Moderate Risk Investments: Insurance,
status, qualifications, occupation, annual income, Mutual Funds, Debentures/Bonds
geographic location etc. have an impact on the  High Risk Investments: Equity Share Market,
investment decision. With that an investor’s Commodity Market, FOREX Market.
ability to handle risks may be related to  Traditional Investments: Real Estate
individual characteristics such as age, time (property), Gold/Silver, Chit Funds.
horizon, liquidity needs, portfolio size, income,
investment knowledge, taxes etc. To make The Respondents - Salaried Employees:
financial decisions, people should be aware about
all the investment alternatives. In the present day, The respondent of research study consists
the major features of an investment are safety of only those people who are earning fixed Income
as salary so the study included only salaried
principal amount, liquidity, income stability,
appreciation and easy transferability. group of people. The Investment pattern of the
There are a large number of investment salaried employees is different due to safety,
areas are available today which can be segregate regular flow of income, tax saving benefits,
into groups to understand them easily. In India, security, Retirement benefits rather than
numbers of investment avenues are available for professionals & businessman.
the investors. Some of them are marketable and
liquid while others are non-marketable and some 2. Review of Literature
of them also highly risky while others are almost
risk less. The people have to choose Proper

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Journal for Studies in Management and Planning I SSN: 2 3 9 5 -0 4 6 3
Available at Vol ume 0 3 I s s ue 0 1
http://edupediapublications.org/journals/index.php/JSMaP/ Ja nua r y 2 0 1 7

Ms. K. Parimalakanthi and Dr. M. Ashok kumar from the universe comprising the city of
(2015) in their study Pertaining to Investment Amritsar was selected. The study analyzed in
Behaviour of Individual Investors in Coimbatore case of adopters that transparency, safety,
City have found that investors prefer to invest in convenience and economy judged as an
banks to enjoying the maximum safety. important feature of net trading followed by
V.R.Palanivelu &K.Chandrakumar(2013) market quality and liquidity whereas in case of
examined the choice in Investment of salaried non-adopters economy and convenience were the
class in Namakkal Taluk, Tamilnadu, India with important features
the help of 100 respondents as a sample size. In
his study he found that as per Income level of followed by the other factors like market quality,
employees, invest in different avenues. safety and liquidity.
Demographic factors are also important while
doing investments. Prasad (2009) examined the perception of the
investors and their awareness on various
Avinash Kumar Singh (2006) the study analyzed investment alternatives available. A sample of
the investment pattern of people in Bangalore 100 investors has been taken from the twin cities
city and Bhubaneswar. The analysis of the study of Hyderabad and Secunderabad. The result of
was undertaken with the help of survey method. findings showed 75% Net traders were using
After analysis and interpretation of data it is online stock trading requiring strong technology
concluded that in Bangalore investors are more base whereas Traditional traders felt online
aware about various investment avenues & the trading not an acute process of stock trading and
risk associated with that. All the age groups give they didn’t participate in net trading due to risk
more important to invest in equity & except of a system failure.
people those who are above 50 give important to
insurance, fixed deposits and tax saving benefits. Significance of the Study:

Karthikeyan (2001) has conducted research on Salaried employees will have fixed
Small Investors Perception onPost office Saving income and their investments patterns may
Schemes and found that there was significant different. In connection with this Researcher will
difference among the four age groups, in the try to find out investment preferences of
level of awareness for kisan vikas patra (KVP),
investors in Kurnool region. This research paper
National Savings Scheme (NSS), and deposit may help to the research scholars as well as
Scheme for Retired Employees (DSRE), and the students for their further studies in respective
Overall Score Confirmed that the level of area.
awareness among investors in the old age group
was higher than in those of young age group.
Objectives of the Study:
Sandhu and Singh (2004) The study was based
on structured primary data. The survey was
conducted during October and November 2004.
The sample of 50 adopters and 50 non-adopters

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Journal for Studies in Management and Planning I SSN: 2 3 9 5 -0 4 6 3
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The present study is an attempt to understand the investment avenues and the result of that have
Investment preferences of employees of Kurnool, been presented in the following table
India. The objectives are as follows:
Investment Preferences Table 1
Investment Freque Percen
1. To study the investment preferences by Rank
Avenue ncy t
salaried employees of Kurnool region, India. Equity 6 6% 8
2. To know the motivational factors of Fixed Deposits 14 14% 2
employees to invest. Provident Fund 9 9% 6
Life Insurance 12 12% 4
3. To determine the factors that influence to
Post Office-NSC 5 5% 9
prefer an investment avenue by the
Gold/Silver/Preci
employees. 23 23% 1
ous stones
Real Estate 10 10% 5
Hypotheses of the Study Mutual Fund 8 8% 7
Chits 13 13% 3
I. H0 : There is no significant influence of Total 100 100%
Gender on investment preference. Source: Primary data
II. H0 : There is no significant influence of Table1 shows that out of 100 respondents 23%
income level on investment preference highly prefer to invest in Gold/Silver/Precious
III. H0 : There is no impact of educational stones next priority goes to Bank Fixed Deposits
qualification on the selection of i.e. 14% as well as 13% investors are saving
investment avenues their money in Chits followed by Insurance,
Real Estate, PF, Mutual Funds and others.
3. Research Methodology:
For this research data has been collected Motivational / Influencing Factors for
through questionnaire.. The study is carried out investment
based on the data collected from individual
investors in Kurnool. The sampling technique There are various elements that influence or
followed in this study is probability sampling. motivate the investors to make investments in
Simple random techniques are used to select the particular securities. The result is displayed in
respondent from the available database. following Table
Accordingly the researcher has selected 100
salaried employees in the study area. Motivational Factors for investment Table 2

4. Results and Discussion: Motivational


Frequency Percent Rank
Investment Preferences Factors
A survey was made among the Health Care 12 12% 5
respondents about their preferences on various Financial Growth 19 19% 2
Future Monetory 9 9% 6

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Journal for Studies in Management and Planning I SSN: 2 3 9 5 -0 4 6 3
Available at Vol ume 0 3 I s s ue 0 1
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Requirement remaining 14, 12, 9, 6 percentages of


Tax benefit 14 14% 4 respondents are investing due to tax benefit,
Children's Future 23 23% 1 Health Care, Future Financial Security and Post
Home Purchase 17 17% 3 Retirement Life respectively.
Post Retirement
6 6% 7
Life
Total 100 100%
Testing of Hypothesis: I
The above table shows that 23 percentage H0 : There is no significant influence of Gender
of respondents investing in different avenues on investment preference
with the objective of securing future of their The chi square test has been adopted to test the
children. 19 percentages of respondents are hypothesis
investing for financial growth followed by 17
percentage respondents to purchase house &
Gender x Investment preferences cross tabulation Table 3
Bank Post Gold/Silver/
Real Mutual
Gender Equity Fixed PF Insurance Office Precious Chits Total
Estate Fund
Deposits -NSC stones
Male 5 5 4 6 2 8 9 5 7 51
Female 1 9 5 6 3 15 1 3 6 49
Total 6 14 9 12 5 23 10 8 13 100
Source: Primary data

Chi- Square Test than the table value so, Null hypothesis is
Value Df Accepted. Hence it can be conclude that “There
Chi-Square 13.19327 8 is no significant influence of Gender on
investment preference”
Table 4

Degree of freedom = (r-1)(c-1) = (2-1) (9-1) = 8 Testing of Hypothesis: II

According to chi-square table, value at 8 degrees H0 : There is no significant influence of income


of freedom at 5% level of significance is 15.5073 level on investment preference
the calculate value is 13.19327, which is less

Income x Investment preferences cross tabulation Table 5


Post Gold/ Silver/
Bank Fixed Insur Real Mutual
Income Equity PF Office- Precious Chits Total
Deposits ance Estate Fund
NSC stones
100000-
1 2 2 3 5 3 0 0 6 22
250000

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Journal for Studies in Management and Planning I SSN: 2 3 9 5 -0 4 6 3
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250000-
1 5 2 4 0 5 1 3 5 26
400000
400000-
1 4 2 2 0 7 3 3 1 23
550000
550000
3 3 3 3 0 8 6 2 1 29
& above
Total 6 14 9 12 5 23 10 8 13 100
Source: Primary data
Chi- Square Test which is more than table value so hypothesis
Value Df is rejected. Hence it is concluded that there is
Chi-Square 40.1131 24 a significant influence of Income level on
Table 6 investment preference

Testing of Hypothesis: III


Degree of freedom = (r-1)(c-1) = (4-1) (9-1) = 24
H0 : There is no impact of educational
According to chi-square table, value at 24 qualification on the selection of
Degrees of freedom 5% significance level is investment avenues
36.415 & the calculated value is 40.1131
Qualification x Investment preferences cross tabulation Table 7

Bank Gold/Si
Provi Post Real
Qualificat Fixed Insur lver/Pre Mutual
Equity dent Office Estat Chits Total
ion Deposit ance cious Fund
Fund -NSC e
s stones
SSC 0 4 2 0 5 1 0 0 5 17
Inter 1 4 2 3 0 5 0 0 5 20
UG 1 3 2 4 0 7 4 4 2 27
PG 4 3 3 5 0 10 6 4 1 36
Total 6 14 9 12 5 23 10 8 13 100
Source: Primary data

Chi- Square Test According to chi-square table, value at 24


Value Df Degrees of freedom 5% significance level is
Chi-Square 49.1331 24 36.415 & the calculated value is 49.1331 which
is more than table value so hypothesis is rejected.
Table 8
Hence it is concluded that there is a significant
influence of qualification level on investment
Degree of freedom = (r-1)(c-1) = (4-1) (9-1) = 24 preference

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Journal for Studies in Management and Planning I SSN: 2 3 9 5 -0 4 6 3
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5. Findings A Study on Investment Preferences


among Employees With Reference To Kurnool,
1. In the study it is found that out of 100 India has been undertaken with the key
respondents 23% highly prefer to invest in objectives such as to find preferred investment
Gold/Silver/Precious stones next priority avenues. Analysis of the study was conducted
goes to Bank Fixed Deposits i.e. 14% as well with the help of survey conducted for the
as 13% investors are saving their money in primary data. After the analysis & interpretation
Chits followed by Insurance, Real Estate, PF, of data it is concluded that Investors are aware
Mutual Funds and others. about investment avenues available in India but
2. 23% of respondents are investing in different still investors are preferred to invest in metals
avenues with the objective of securing future (Gold/Silver), bank deposit, chits, and real
of their children. estate. The data analysis reveals that the safety
and liquidity is most considerable factor while
3. 19% of respondents are investing for
making investment and remaining avenues are
financial growth followed by 17%
less considerable while making investment
respondents to purchase house & remaining
decisions by the investors. Hence it is concluded
14, 12, 9, 6 percentages of respondents are
the employees in the study area are more
investing due to tax benefit, Health Care,
cautious about secured and stable income on
Future Financial Security and Post
their investments.
Retirement Life respectively.
4. Using the 'Chi-SQUARE' test it is found that
“There is no significant influence of Gender References
on investment preference”
5. There is a significant influence of Income 1. Ms. K. Parimalakanthi and Dr. M. Ashok
level on investment preference kumar (2015) “A Study Pertaining to
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in Coimbatore City” International Journal of
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Advance Research in Computer Science and
preference
Management Studies Volume 3, Issue 6, June
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investing their money Godl/Silver & 14% of on preferred investment avenues among
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Bank Deposits. Tamilnadu India”, IBEA, International
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Growth. 3. Karthikeyan. B., (2001), 'Small Investors'
Perception on Post Office Small Savings
Schemes', unpublished thesis, Madras
Conclusion: University, Tamilnadu, India

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