A DEMOGRAPHIC ANALYSIS OF INVESTORS BEHAVIOR TOWARDS DERIVATIVESINSTRUMENTS AT HYDERABAD CITY OF TELANGANA STATE

Abstract

The study of investors' behavior towards derivative instruments has gained substantial attention in financial research due to the complexities and potential benefits associated with these financial tools. Derivatives, such as options, futures, swaps, and forwards, are financial instruments whose value is derived from underlying assets like stocks, bonds, commodities, or market indices. They are widely used for hedging risk, speculation, and arbitrage, making them integral to modern financial markets. The present study aim is to measure the investors awareness towards various derivatives instruments and their investment intention. For this purpose, the study adopted non – probability sampling method and convenient sampling technique. The researcher administered a structured questionnaire (Google forms) to sample respondents through online mode (e-mail, WhatsApp) to 200 sample investors in Hyderabad city. Out of 200 sample questionnaires, 38 are excluded due to non-response and invalid (half – filled) responses. The final sample consists of 172 and analyzed by using frequency method, descriptive statistics, correlation, Anova – one way test. The Anova – one way test results indicates that demographic factors such as occupation, educational qualification, marital status, and annual income generally have significant effects on investment intentions and behaviors. Age, however, appears to have a limited impact, except on factors influencing investment decisions. The χ2 results shows that educational qualification and marital status are consistently significant factors affecting various aspects of investors' behavior, including awareness, confidence, and risk tolerance. Age shows a significant impact only on awareness of derivatives.