INTERNATIONAL JOURNAL OF ENGINEERING MANAGEMENT AND
SOCIAL SCIENCES
(An International Peer-Reviewed Multi-Disciplinary Journal)
ISSN : 3139-065X
www.ijemss.com
This study investigates how stock market volatility shapes retail investor decision-making behavior in India during the period 2022–2025. Drawing on primary survey data from 100 retail investors and secondary data from NSE/BSE market reports, the research employs a One-Way Analysis of Variance (ANOVA) to examine statistically significant differences in investor behavioral responses—specifically panic selling, holding, buying more, and taking no action—across three investor age cohorts (below 25, 25–35, and above 35). The ANOVA results reveal a statistically significant difference in panic-selling behavior across age groups (F(2, 97) = 4.83, p = .010), confirming that younger investors are disproportionately susceptible to emotion-driven decisions during volatile periods. Grounded in Prospect Theory (Kahneman & Tversky, 1979), behavioral finance frameworks (Baker & Wurgler, 2007), and market-efficiency literature (Fama, 1970), the study highlights the interplay of psychological biases, information asymmetry, and demographic variables in shaping investment choices. Findings underscore the critical need for financial literacy programs, personalized advisory services, and policy interventions to improve rational decision-making in volatile market environments.
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