Impact of Behavioral Biases on Investment Decision Making: Evidence from the Review of Literature

The objective of the present study is to explore the literature available on behavioural biases impacting investors’ decision-making. From the literature studied, the researcher observed that from 2010 onwards, there was an increasing interest in the research community to explore this emerging topic of behavioural finance. Hence past 11 years, from 2010 onwards, articles were considered for the study to understand the influence of biases on financial decision-making. The Systematic Review of Literature (SLR) method is used for the study. The present study facilitates the identification of the gap in the current body of knowledge, thereby guiding future research in behavioural finance. The literature of 32 papers proved the impact of behavioural biases like Overconfidence, Anchoring, Loss Aversion Availability Biases, etc., on investment decisions. A review of selected papers suggested the gaps in exploring the prominent factor among objective and subjective factors impacting investment decision-making among investors and its effect on choosing a particular investment avenue. The study would greatly help investors, financial advisors, and the government.