FINANCIAL LITERACY AND STOCK MARKET PARTICIPATION IN INDIA

Abstract

The study aims to examine the relationship between financial literacy and the stock market participation in India. The participation in the Stock market includes investment in Stocks as well as Mutual Funds. The study is based on a survey of 408 Indian households. Financial Literacy is measured using objective measures of basic and advanced financial knowledge. Logistic regression was conducted to measure the relationships. The results show that there is a significant and positive influence of financial literacy. Moreover, the socio-demographic variables such as Investment experience, gender, marital status and income exhibit strong relationship with stock market participation. The study has implications for investors, financial services sector, government and policy makers in understanding the reason behind low stock market participation and devising strategies for boosting financial literacy.

Keywords

financial literacy, stock market participation, india, stockholdings, investment, stocks, mutual funds.

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To cite this article

Muniza Ahmad. (2021). Financial Literacy and Stock Market Participation in India. Sparkling International Journal of Multidisciplinary Research Studies, 4(4), 8-21.