CHAPTER – VII

FINDINGS, SUGGESTIONS AND CONCLUSIONS

7.1. INTRODUCTION
Every individual employee possess different mindset when it comes to deciding
about investing in a particular investment avenue such as stocks, bonds, mutual funds,
fixed deposit, real estate, bullion etc. In general, every employee desires that their hard
earned money be invested in most secure avenues and should bring about the maximum
returns. The decision to invest into various avenues however varies for every employee
depending on their risk taking ability and the purpose for which such investment is made.
Purpose of investment can be related with saving objective. Each individual investor
selects the investment option for certain time period looking at their personal financial
goals. Investment behavior of an employee reveals the need to allocate the surplus
financial resources to various instruments available for investment. The investment
behavior consists of why they want to invest, how much of their disposable income they
want to invest, for how many years or months they want to invest and most importantly
the timing of such investment. Based on the knowledge about these kind of behaviours,
the study has progressed with these different objectives in focus, and the objectives are
listed as follows:

To study the scope of investment patterns opted by Government and private sector
employees.

To examine and compare the investment preference and risk perception of
Government and Private sector Employees.

To analyze the Level of investment of Government and Private sector Employees.

To evaluate and compare the perception of return on investment and satisfaction
level of Government and Private sector Employees.

To analyze the overall satisfaction on investment of Government and Private sector
Employees using an appropriate model.
A sample of 1000 salaried employees belonging to Government and private sector
in Coimbatore district have been taken for the study and the sample size was determined
by applying the convenient sampling method. The primary data was collected by framing
structured questionnaire for the employees of both the sectors. The statistical tools
namely Friedman’s ranking, ANOVA, chi-square, Correlation, Regression and Multiple
Regression were used to analyze the data and the following observations have been made.

CHAPTER IV analyses the investment preference and risk perception of

Government and Private sector Employees.

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7.2. PREFERENCE FOR INVESTMENT
The mean scores of have been prioritized with safety of money being at the top
followed by Tax benefits and regular returns as the focus for the Government employees,
and in case of Private sector employees, factors were prioritized with safety of money as
the topmost, (which is the same as Government employees) followed by regular returns
and long term benefit. It is clear that among both categories of employees safety for
money is given the first preference.

ANOVA has been applied to analyze the significant mean preference index
between the demographic and socioeconomic factors in respect of preference for
investment with reference to Government and private sector employees and the result
shows that

The mean preference scores with respect to criteria of age and its relationship to
investment, for Government and private sector employees are within the age group of
30 years. It is clear that both categories of employees belonging to the same age group
have high preference for investment. This infers that the young employees within 30
years of age group show high interest for investment.

Most of the Government employees having 3 to 4 members as family members show
high preference for investment than that of private sector employees. In case of private
sector employees the relationship between the numbers of family members and the
preference for investment was found to be insignificant.

In case of Government employees, most of the employees who are having nuclear
nature of family reveal high preference for investment, while this was not the case with
private sector employees. This shows that Government employees living in nuclear
family show high possibility for investment. In case of private employees, their
preference remains the same irrespective of the nature of family.

It is observed that the Government employees who are living in leased house show
high preference for investment when compared to private sector employees. In case of
private sector employees, the type of house they live in is found to have insignificant
influence in their preference to invest. We can infer that the Government employees
living in leased house invest more for their future needs.

Majority (mean 63.88) of the employees of both Government and private sector who
are professionally qualified showed high preference towards investment. It reveals that
professional qualification had an influence in the employees opting for higher
investments. It is infers that the awareness and knowledge about the investments play a
role in employees showing preference to invest.

The relationship between the monthly income of Government employees and their
investment was insignificant whereas private sector employees with higher income
showed higher preference towards investment. Private sector employees with a
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 monthly income bracket of `25,000/- to `50,000/- had a high (mean 64.70) preference
towards investment. Thereby infer that when income level increases the investment
simultaneously increases.

The savings bracket of `7,501/- to `15,000/- among the Government employees
reveals high preference for investment. The high preference for investment can be then
correlated with higher savings bracket.

The mean preference score for investment was found to be high among Government
and private sector employees who are employed in banking sector and chit funds. It
definitely draw a correlation that the knowledge of the employees has about finance in
general plays a role in their preference to invest.

Majority of the Government employees (mean 69.39) having more than one additional
source of earnings showed higher preference for investment. Additional source of
earning is found to be insignificant factor influencing investment, among the Private
sector employees.

The analysis reveals that the period of investment is an insignificant factor associated
with investment, amongst the Government employees while it had high influence on
the private sector employees, especially among those who invested between 6 and 10
year period. It is inferred from the analysis that Government employees prefer to have
both long term and short term investment but private employees mostly prefer long
term investment for their safe future.

It emerged from our analysis that the liquid and non-liquid nature of investment had
higher preference among both the Government and private sector employees. It infers
the high mean preference score.

Majority (mean 76.02) of the Government and Private sector employees show high
preference on perception on return on investment.

The high mean preference score implies the high (mean 74.03) satisfaction level
among Government and Private sector employees. It is clear that all the employees are
highly satisfied with their investment pattern and also the returns out of such returns.
This is substantiated with the structured equation model.

The Government employees reveal high risk perception towards the preference for
investment and in the case of Private sector employees the mean preference score
depict high and moderate risk perception towards the investment preferences.
To analyze the significance between preference for investment and the various
demographic and socioeconomic factors, chi-square test was performed. The chi-square
result revealed the following:

Government employees belonging to the age group of above 50 years and Private
sector employees within the age group of 30 years have high level of preference for
investment.

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Government employees, having 3 to 4 members as number of family members showed
high preference for investment whereas among the private sector employees’ number
of family members was not found to be associated with preference for investment.

The Government employees’ living in leased house showed a high level of preference
for investment whereas type of residence was not associated with preference for
investment amongst the private sector employees’.

The Government employees who were qualified at higher secondary level of education
confirm high preference towards investment and this factor was not found associated
in case of private sector employees.

The high level of preference towards investment is observed to be high among the
Government employees having a monthly savings bracket of Rs.7,501/- to
Rs.15,000/- and monthly savings factor is not found associated with preference to
invest, among the private sector employees.

Government employees having additional source of earnings reveals high
preference for investment whereas in the case of private sector employees’
additional earnings is not associated.

The level of preference for investment of Government employees is not associated
with the period of investment whereas private sector employees’ level of
preference depicts high with 6 to 10 years as period of investment.

The high level of preference for investment among Government and private sector
employees reveals both liquid and non-liquid nature of investment. Both liquid and
non-liquid nature of investment reveals high level of preference among the
Government and private sector employees.

Level of preference on return on investment is high in both the Government and
private sector employees towards their invested money.

Level of satisfaction is high among Government and private sector employees
towards their preference for investment.

The Government and private sector employees reveal high risk perception towards
the preference for investment.
7.3. RISK PERCEPTION
The risk perception on various investment of Government employees are ranked as
Private Chit, Private Financial Deposit and Equity Shares. Private sector employees risk
perception on different investment is ranked as Private Chit, Financial Deposit and Equity
Shares. Therefore it is obvious that both Government and Private sector employees
interpret similarly that private chit is a more risky investment.
The factors of risk perception of Government employees towards investments are
ranked as Global Recession, Fluctuation in Share Price and Fluctuation in Interest Rate.
Among the Private sector employees the factors that influence risk are ranked as

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fluctuation in share price, fluctuation in interest rate and financial insolvency. Thus it is
clear that Government employees have different opinion when compared to the private
sector employees when it comes to the factor of risk perception.
ANOVA has been applied for the demographic and socioeconomic factors with respect to
risk perception among the two sectors of employees. The ANOVA result shows that

The Government employees who belong to the age group of 30 years reveal high
risk perception while private sector employees of the age group of 31 to 50 years
reveal high risk perception. This infers that government employees are aware of
risk of investment at their young age but private sector employees are aware of risk
at 31 to 50 years of age.

The mean risk perception score depict high in single or unmarried Government
employees and in private sector employees mean risk perception score reveals high
in married employees.

The mean risk perception score of Government employees is insignificant whereas
private sector employees with higher secondary education level have high risk
perception.

The mean risk perception score of Government employees is insignificant whereas
private sector employees’ monthly income bracket of Rs.25, 000/- to Rs.50, 000/-
reveals high.

Mean risk perception score of Government employees is insignificant and in
private sector employees the mean risk perception reveals high in employees with
above Rs.30,000/- as monthly expenditure.

The Government employees who are employed in insurance sector show high
mean risk perception score and majority (mean 57.65) of the private sector
employees working in communication department are more significant.

It is observed that the Government employees who are having more than one
additional earnings show high risk perception when compared to private sector
employees. The mean risk perception score is insignificant in private sector
employees.

The Government employees having up to 5 years as the period of investment
reveals the high mean risk perception score whereas in case of private sector
employees the mean risk perception score is insignificant.

The high mean risk perception score is high in both Government and private sector
employees who are having both liquid and non-liquid nature of investment.

Majority (mean 63.08) of the Government and private sector employees reveals
high mean risk perception towards perception on return on investment.

The mean risk perception score in Government and private sector employees is
high with high level of satisfaction.

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To analyze the significant relationship between risk perception and demographic and
socioeconomic factors chi-square test is applied. The following factors are significantly
associated with the risk perception of Government and private sector employees:

Most of the Government employees within 30 years of age prefer high risk on their
preferred investment than that of private sector employees. In case of private sector
employees risk perception is not associated.

Single or unmarried Government employees depict high level of risk perception
and in case of private sector employees marital status is not significantly associated
with the level of risk perception.

Monthly expenditure is not associated with the level of risk perception in
Government employees. The private sector employees with above Rs.30,000/-
monthly expenditure show risk perception.

Employment Sector or the nature of the employment is not significantly associated
with level of risk perception in Government employees. In case of private sector
employees, those working in communication and insurance companies reveal high
level of risk perception.

The level of risk perception is high among Government employees with one
number of sources and is not significantly associated with number of sources
among private sector employees. This infers that the Government employees who
are having only one source of income show high sensitivity on risk.

It is observed that the Government employees who are having one additional
earnings depict high level of risk perception when compared to private sector
employees. The level of risk perception is not significantly associated with risk
perception in private sector employees.

The Government employees who have opted up to 5 years as investment period
reveals high risk perception on investment and in case of private sector employees
the period of investment is not significantly associated.

High perception on return on investment is expected by the large number of
Government and private sector employees. So the both sector of employees are
preferred to take high risk for high returns.

The Government and private sector employees have high risk perception to reap
higher level of satisfaction from their investment.
Fifth Chapter compares the Level of Investment between Government and private sector
employees.

7.4. LEVEL OF INVESTMENT

The persons/factors inducing the investment habit in Government employees are
ranked as self-motivation, parents and spouse as source of inducement for investment and

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in case of private sector employees, the persons/factors inducing the investment habit are
ranked as self-motivation, parents and friends. From the analysis it is clear that, both
Government and private sector employees are induced by self-motivation. The employees
out of their own interest invest their money.
ANOVA has been applied for the demographic and socioeconomic factors in respect of
Level of Investment with reference to the employees. The ANOVA result shows that

The mean investment scores of investment are insignificant in Government
employees and are significant in private sector employees above 50 years of age. It
is clear that employees at the age of 50 years have high investment.

The mean investment scores are insignificant in Government employees. Female
private sector employees reveal high mean investment scores. It is clear that female
employees are more likely to show high investment when compared to males.

The Government and private sector employees mean investment scores are high in
employees who are qualified as post graduates and professionals. It reveals that
post graduates and professionally qualified employees always prefer and opt for
high investments.

The mean investment score in Government and private sector employees is high
with monthly income above Rs.50, 000.

Monthly expenditure of the limit up to Rs.15,000 reveals high investment in
Government employees and monthly expenditure reveals insignificant in private
sector employees.

Government and private sector employees, whose monthly savings is above Rs.15,
000 favour high investments. This interprets that both sectors of employees have
same extent of investment.

The high mean investment score is high in Government employees working in
electricity department and the high mean investment score is high in private sector
employees working in chit fund.

The Government employees with more than 2 numbers of sources of income reveal
high investment. The high mean investment score is insignificant with numbers of
sources of income in private sector employees.

The Government employees comprising one additional earnings reveal high
investment and the mean investment score is insignificant with additional earnings
in private sector employees.

The Government employees depict high investment comprising up to 5 years as
period of investment and is insignificant in private sector employees.

The mean investment score is insignificant in Government employees and the high
mean investment score is high in private sector employees having both liquid and
non-liquid nature of investment.

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Government and private sector employees have high perception on return on
investment towards their investment.

The satisfaction level in Government employees reveals insignificant and in
private sector employees having high satisfaction level reveals high investment.

The mean investment score are insignificant in Government employees and the
mean investment score implies high risk perception in private sector employees.
To analyze the significant relationship between level of investment and demographic and
socioeconomic factors chi-square is applied. The following factors are significantly related
with the Level of investment:

The level of investment in Government employees is not significantly associated
with the age factor and in private sector employees, large number of the employees
above 50 years of age (50.00%) reveal high level of investment.

The level of investment in Government employees is not significantly associated
and in private sector employees up to 2 members as number of family member
have high level of investment.

The nature of family is not significantly associated among Government employees
and nuclear nature of family reveals high level of investment in private sector
employees.

The high level of investment in Government and private sector employees is high
among employees with diploma and higher secondary level of education.

The high level of investment in Government and private sector employees depicts
high with monthly income of above Rs.50, 000.

Government employees monthly expenditure up to Rs.15,000/- depict high level of
investment. Private sector employees’ level of investment is not significantly
associated with monthly expenditure.

Most of the Government and private sector employees having monthly savings at
above Rs.15, 001/- shows high level of investment.

The Government employees working in postal department reveal high level of
investment and the in private sector employees, high level of investment reveals
high in employees working in communication department.

High level of investment in Government employees is high with one source of
income and level of investment is not significantly associated in private sector
employees.

The Government employees having one additional earning show high level of
investment and in private sector employees, additional earnings is not significantly
associated.

Both Government and private sector employees having both liquid and non-liquid
nature of investment show high investment.

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The high level of investment is revealed high in Government and private sector
employees with moderate perception on return on investment.

The Government and private sector employees comprising low level of satisfaction
depict high level of investment.

The high level of investment in Government and private sector employees is high
with high risk perception.

7.5. CORRELATION ANALYSIS

Correlation analysis has been employed for various aspects of demographic and
socioeconomic factors in association with the level on investment. There is an excellent
positive correlation between the level of investment and the demographic and
socioeconomic factors namely, Age, Educational Qualification, Nature of Investment and
Perception on Return on Investment.
Educational Qualification is positively correlated with 0.90 per cent of the
variation in the level of investment. In case of nature of investment is positively correlated
showing 0.96 per cent of the variation in the level of investment and Perception on Return
on Investment with 0.13 percent of the variation in the level of investment. It is observed
that age and Investment are negatively correlated with (-0.50) percent of the variation in
the level of investment. This shows that the level of investment varies according to the age
of the investors.
Socio-economic factor associated with Investment- Correlation Analysis - private
sector
Correlation has been employed for various aspects of demographic and
socioeconomic factors in association with the level on investment. There is a positive
correlation between the level of investment and the demographic and socioeconomic
factors namely, Gender, Perception on Return on Investment and Risk perception.
Gender is positively correlated with 0.90 per cent of the variation in the level of
investment. Perception on Return on Investment is positively correlated with 0.80 per cent
of the variation in the level of investment. Risk perception is positively correlated with
0.90 per cent of the variation in the level of investment.

7.6. MULTIPLE REGRESSION ANALYSIS

Multiple Regression has been employed for various aspects of demographic and
socioeconomic factors in association with the level on investment. From the analysis it is
observed that, there is negative regression between the level of investment and the
demographic and socioeconomic factors namely, Monthly Expenditure, Marital Status,
and Period of Investment.

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 The regression coefficient indicates that marital status negatively influences the
level of investment showing the increase investment by 2.595 units. Single marital status
will lead to higher level of investment.
The regression coefficient indicates that monthly expenditure negatively influences
the level of investment with a unit of decrease in monthly expenditure shall increase
investment by 0.001 units. Lesser the level of monthly expenditure leads to higher level of
investment.
Overall Significance Level
The value of R2 is found to be significant at 1% level. This shows that the
regression equation framed is a good fit. Around 45.00 per cent of variation in level of
investment is due to the socio-economic factors analyzed in this study.

7.7. STEP-WISE REGRESSION ANALYSIS-Government Employees

In the first step, the variable named ‘Monthly Savings’ has been introduced. This
variable contributes to 29.00 per cent to the variation in investment. ‘Monthly Income’ is
the variable introduced in step two. This variable, along with ‘Monthly Savings’, accounts
for 39.00 per cent of variation in investment. The contribution has increased by 10.00 per
cent. ‘Sector’, a third variable, has increased the contribution from 39.00 per cent to 40.20
per cent. The contribution gets further increased by 1.10 per cent to 41.30 per cent, with
the introduction of the variable ‘Nature of Family’. ‘Gender’ is the variable introduced in
the step five. The contribution got further increased to 42.40 per cent. ‘Number of family
members’ is the last socio-economic factor introduced. The total contribution of the six
socio-economic factor namely, (i) Monthly Savings (ii) Monthly Income (iii) Sector (iv)
Nature of Family (v) Gender and (vi) Number of Family Members amounts to 43.20 per
cent. The R2 value of the multiple regression amounts to 44.80 per cent. The difference of
1.60 per cent is due to contribution by other socio-economic factors.

7.8. STEP-WISE REGRESSION ANALYSIS-Private Sector Employees

In the first step, the variable named ‘Monthly Savings’ has been introduced. This
variable contributes 27.50 per cent to the variation in investment. ‘Monthly Expenditure’
is the variable introduced in step two. This variable, along with ‘Monthly Savings’,
accounts for 41.60 per cent of variation in investment. The contribution has increased by
14.10 per cent. ‘Additional Earnings’, a third variable, has increased the contribution from
41.60 per cent to 42.50 per cent. The contribution gets further increased by 0.75 per cent
to 43.00 per cent, with the introduction of the variable ‘Age’. ‘The total contribution of the
four socio-economic factor namely, (i) Monthly Savings (ii) Monthly Expenditure (iii)
Additional Earnings and (iv) Age amounts to 43.00 per cent. The R2 value of the multiple
regression amounts to 45.00 per cent. The difference of 2.00 per cent is due to contribution
by other socio-economic factors.
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Sixth Chapter evaluates and compares the perception of return on investment and
satisfaction level of Government and Private sector Employees.

7.9. PERCEPTION ON RETURN ON INVESTMENT

The perception on return on investment of Government employees investments are
ranked as Land, Gold and Bank Deposit. The perception on return on investment of
Private sector employees is ranked as Land, Gold and Bank Deposit. Thus it is clear from
the analysis that both Government and Private sector employees’ value same level of
perception on return on investment.
ANOVA has been employed for the demographic and socioeconomic factors in respect of
perception on return on investment with reference to the employees. The ANOVA result
shows that

Government employees within 30 years of age reveal high mean perception on
return on investment and high mean perception on return on investment is
insignificant in Private sector employees.

The high mean perception on return on investment score is insignificant in
Government employees. Private sector employees having higher secondary level
education reveal high mean perception on return on investment.

The monthly expenditure of Government and private sector employees with Rs.15,
000/- and above Rs.30, 000/- reveal high perception on return on investment.

The high mean perception on return on investment score is high in Government
employees having more than one additional earnings and mean perception on
return on investment score is insignificant in private sector employees.

The Government employees having up to 5 years as period of investment depict
high perception on return on investment. In private sector employees, 6 to 10 years
as period of investment depict high perception on return on investment.

Both liquid and non-liquid nature of investment reveals high perception on return
on investment in Government and private sector employees.

Majority (65.55) of Government and private sector employees having high level of
perception on return on investment infers high level of satisfaction.

Majority (mean 65.07) of Government and private sector employees mean
perception on return on investment score implies the high risk perception.
To analyze the significant relationship between perception on return on investment and
demographic and socioeconomic factors chi-square is applied. The following factors are
significantly related with the perception on return on investment:

Majority of Government employees within 30 years of age have high perception on
return on investment. Age is not significantly associated in private sector
employees.

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Government and private sector employees earning a monthly income of up to
`25,000/- and with income bracket of `25,000/- to `50,000/- reveal high level of
perception on return on investment.

Government employees having monthly expenditure comprising `15,000/- depict
high level of perception on return on investment. In private sector employees, the
monthly expenditure of above `30,000/- reveal high perception on return on
investment.

Government employees’ high perception on return on investment is not
significantly associated with monthly savings and high level of perception on
return on investment is revealed in private sector employees with monthly savings
of up to `7,500/-.

Level of perception on return on investment is not significantly associated with the
employment sector and majority of the private sector employees working in
communication department depict high perception on return on investment.

The Government employees having one number of additional income source depict
high perception on return on investment and in private sector employees’ level of
perception on return on investment is not significantly associated with number of
income sources.

Government employees having one additional earning depict high perception on
return on investment and in private sector employees, additional earnings is not
significantly associated.

The period of investment in Government employees comprising up to 5 years
reveals high perception on return on investment and in private sector employees
the period of investment between 6 to 10 years depict high perception on return on
investment.

The Government and private sector employees having both liquid and non-liquid
nature of investment reveal high perception on return on investment.

Majority of Government and private sector employees infers high level of
satisfaction towards perception on return on investment.

Government and private sector employees reveal higher risk perception with high
level of perception on return on investment.

7.10. LEVEL OF SATISFACTION

The level of satisfaction among Government employees are ranked as Bank
Deposit, Land and Gold. The satisfaction level of the private sector employees with the
investment are ranked as Bank Deposit, Gold and Land. This shows that both categories of
employees have same level of satisfaction with their investment avenues.

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 ANOVA has been employed for the demographic and socioeconomic factors in respect
of level of satisfaction with reference to the employees. The ANOVA result shows that

Government employees within the age of 50 years reveal high level of satisfaction
and in private sector employees the mean satisfaction index is insignificant.

The unmarried Government employees reveal high satisfaction level but in private
sector employees the mean satisfaction index is insignificantly associated with
marital status.

Government and private sector employees having joint nature of family depict high
satisfaction level.

Government employees living in leased house reveal high satisfaction level, which
is significant when compared to private sector employees.

Educational qualification of Government employees is insignificant and the large
number of private sector employees with higher secondary education level reveals
high satisfaction level.

Monthly income is insignificantly associated with satisfaction level in Government
employees. Private sector employees with monthly income above `50, 000/-
reveals higher satisfaction.

The high mean satisfaction score is revealed in Government and private sector
employees with monthly expenditure up to `15,000/- and above `50,000/-
respectively.

Government employees comprising more than one additional earnings reveals high
satisfaction level. In private sector employees, the mean satisfaction index is
insignificant.

The high mean satisfaction score in Government employees is insignificant. The
period of investment depict high satisfaction level in private sector employees
having 6 to 10 years as the period of investment.

Majority (mean 64.43) of the Government and private sector employees reveals
high perception on Return on investment.

Government and private sector employees mean satisfaction score implies high
risk perception.
To analyze the significant relationship between level of satisfaction and demographic and
socioeconomic factors chi-square is applied. The following factors are found to be
significantly related with the level of satisfaction:

The Government employees within 30 years of age reveal high level of satisfaction
and private sector employees’ level of satisfaction is not significantly associated.

The high level of satisfaction of Government employees depicts in female
employees and private sector employees’ level of satisfaction is not significantly
associated.

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The unmarried Government employees reveal high level of satisfaction and in
private sector employees the level of satisfaction is not significantly associated.

The level of satisfaction in Government employees is not significantly associated
with the nature of family. The private sector employees having joint nature of
family depicts high level of satisfaction.

The Government employees living in leased house reveal high level of satisfaction
when compared to private sector employees which is not associated.

Monthly income is not associated with the level of satisfaction in Government
employees and monthly income bracket of `25,000/- to `50,000/- in private sector
employees reveals higher satisfaction.

The Government employees having up to `15,000/- as monthly expenditure show
high level of satisfaction when compared to private sector employees which is not
associated.

The Government employees comprising one source of income reveal high level of
satisfaction. The number of sources is not significantly associated with the level of
satisfaction in private sector employees.

The Government employees having more than one additional earnings reveals high
level of satisfaction and in private sector employees, the level of satisfaction is not
significantly associated.

Government and private sector employees’ period of investment inclining up to 5
years shows high level of satisfaction.

High level of satisfaction is inferred in Government and private sector employees
towards their perception on return on investment.

The Government and private sector employees having high risk perception show
high level of satisfaction.
Thus these are the factors that reveal to be significantly associated to the level of
satisfaction.

7.11. STRUCTURED EQUATION MODEL

This equation is employed in order to find out the overall satisfaction of the
employees. From the path diagram, measured variables with latent variable of Satisfaction
after Investment is having a positive relationship and also significant at 1 percent level. It
is concluded that there is a direct impact on satisfaction among Government and Private
Sector Employees based on their investment risk and returns.

7.12. SUGGESTIONS AND RECOMMENDATIONS

Safety is the factor, which influence the investors mostly by making a particular
investment decision.

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Suggestions to Investors
• The investors who are in need of secured investment should invest in government
securities and government bonds which are less risk securities and good way for
salaried individuals to utilize their savings. There are no chances of default in these
securities.
• The investors need to understand their risk tolerance level because everywhere
there are many investments alternatives.
• It was found that the instruments of the capital market like equity shares,
debentures, and mutual fund units have not influenced the employees. Hence, the
policy should be to spread these and other financial instruments.
• It was analyzed that any of the educated employees seems to invest more. So steps
should be taken to give investment education for illiterates.
• Many of the employees have medium and long term nature of investment. So it is
mandatory for the employees to choose safe and reliable investment avenues.
• Saving money is the traditional habit of employees. But it is blind saving. It is
necessary to save the amount for future benefits and getting maximum returns. The
employees are suggested to save their money into beneficial avenues.
• The employees should approach to the professional such as Tax Consultant,
auditors to get dual benefits. They should avoid the listing of trials or not to take
self decisions when they wants to make investment into any avenue. It is better to
consult with experts in that field.
Financial Institution
• Company shall make the investors aware about all the latest Investment
opportunities available, which are less risky.
• Investor those who invested in post office, fixed Deposit and insurance does not
seems to invest in shares, mutual funds and bonds and other investment avenues.
• The main reason is that investors are not much aware about the latest investment
avenues. So, company shall make the investors aware about it.
• The main factors affecting the choice of investment are found as better annual
returns, less risk averse can project offering in different investment avenues.
• They have to provide customized advisory services to help investors to opt for the
right investment choice that are specifically suited to their portfolio.
• The return on investment is required to give more attention in order to satisfy the
desires of the investors.
• There is an explosion in the growth of middle class families due to double income
and increase in number of working women. Hence effort should be made to attract
women investors by providing right information and knowledge about the market
through advertisement.

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 • Different groups of investors like, professionals, businessman pay less attention
while evaluating the pros and cons of investing in different securities. The need
and benefits of the systematic and analytical evaluation of different alternatives
and competitive avenues need to be explained to them. Then only it is possible to
park their surplus funds in economical viable condition.
Government
• Government should make available more proper financial education consultants in
order to educate the investors about investing and about the various avenues
available namely stocks and bonds. It gives proper awareness and to know how
about securities to invest for salaried individuals.
• Attractive and innovative investment avenues can be introduced for investors.
• Government can concentrate to introduce new attractive and feasible tax saving
instrument.
• Gold and real estate are considered to be the most profitable investment. Some of
the banks like State Bank of India are selling gold in paper format, instead of
buying the actual gold it is valuable to salaried group to purchase in installment
basis.

7.13. SCOPE FOR FURTHER RESEARCH

The study is conducted by taking a reasonable sample sizes and this analysis
reflects preference, risk perception, perception on Return on Investment and satisfaction of
those employees belonging to Government and private sector sectors in Coimbatore
District.

• There are chances for research in awareness, factors needed for awareness and the
depth knowledge of the entire investment avenue which are lacking in investors
about the concept and working of the investment pattern available currently in the
market.
• The women investors’ perception towards these investment instruments can also be
taken up as an analysis.
• Investment pattern of people with different occupation other than salaried
employees can also be considered.
• At present capital market has not made much headway in both sectors. Research
can be conducted to identify the ways to make the capital market attractive to the
employees.
• Lastly, the savings and investment pattern of wage earners can also be taken up for
research.

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7.14. CONCLUSION
Today, with the living standard of the people increasing day by day, the investors
have started realizing the importance of savings and the proper investment of their
savings. It is evident from the study undertaken that the investors are saving their money
for the goals of life. The various factors identified in the study provide some valuable
input regarding the investor’s pattern, their preferences and priorities. This will guide the
organization in designing financial products for the various segments of investors. The
buying intent of investment product by a small investor can be due to multiple reasons
depending upon the risk return trade off. Due to the reduction in the bank interest rates and
high degree of volatility in Indian Stock market, investors are looking at an alternative for
their investments, which will provide them higher returns and also safety to their
investments. Based on all these factors an effort is made to identify the level of
satisfaction among the sample of employees based on convenient sampling. This analysis
is an indication of perception on return of investment and their level of satisfaction based
on preference of investment and their risk taking capacity of the various categories of
salaried individuals which influences their level of investment. Despite of certain
limitations to the study, there were some investment patterns which had some
commonness in these employees. With much concentration in identifying the factors for
risk, investment level in various investment avenues are identified based on their socio-
economic factors.
The present analysis has important implication for investment managers as it has
come out with certain interesting facets of the salaried individual. The individual investor
still prefers to invest in financial products which give risk free returns. This confirms that
employees even if they are earning high income, well educated, middle and lower age
group, having minimum number of family members are conservative and prefer to invest
safe. The investment product designers of financial companies should cater to individuals,
who are low risk tolerant, tax savings and with high satisfaction with normal returns. The
analysis also draws an important conclusion that the employees are keen to invest in
midterm period i.e., 5 to 10 years of period of investment and with both liquid and non-
liquid nature of investments.

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