Cognitive Biases in Investment Decisions: A Cross-Generational Analysis

Abstract

Building on extensive research that highlights the role of cognitive biases in investor decision-making, this study examines how biases such as Overconfidence, Anchoring, Bandwagon Effect (Herding Behaviour), Loss Aversion, Confirmation Bias, and Hindsight Bias influence investment decisions across various age groups within the Indian financial market. By analysing these biases in the context of age-based demographic profiles, the paper seeks to uncover age-specific patterns that may affect susceptibility to psychological biases in financial behaviour. This study focuses on group dynamics that work differently for different biases. This includes examining the role of age in decision-making, and the impact of age on cognitive bias resistance.