Exploring Gender-based Differences in Investment Behaviour: A Study of Behavioural Biases

Abstract

This study investigates gender-based differences in investment behaviour among millennial retail investors in India, with a special focus on cognitive behavioural biases. Drawing from the theoretical framework of behavioural finance, the research examines the influence of availability bias, loss aversion, herding behaviour, overconfidence, mental accounting, confirmation bias and representativeness heuristic on investment-related decision-making across genders. Data were collected from individuals aged 30–40 years. Analyses were conducted using linear discriminant analysis while cross-verifying using binary logistic regression to ensure robustness. The results reveal that female investors exhibit significantly higher susceptibility to several behavioural biases, particularly mental accounting, availability bias and confirmation bias, which emerged as the most powerful discriminators. However, overconfidence and loss aversion did not show significant effects. The study serves as evidence to recommend targeted interventions addressing these specific biases. Financial advisory services and tailored educational programmes can be implemented that focus on mitigating cognitive biases and empowering investors based on their individuality, rather than generalizations.