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Editorial Board A Refereed Monthly International Journal of Management
Prof. B. P. Sharma
(Editor in Chief)
Prof. Mahima Birla
(Additional Editor in Chief)
Dr. Khushbu Agarwal
(Editor)
Ms. Asha Galundia
(Circulation Manager)

 Editorial Team

Dr. Devendra Shrimali
Dr. Dharmesh Motwani
 

Empirical Analysis on Savings and Investment Behaviour of College Faculty Members in Puducherry Region

 

 

Dr. N. S. PANDEY*

Assistant Professor ( Selection Grade)

drnspandey@gmail.com

 

P.KATHAVARAYAN**

Doctoral Research Scholar

kathavarayan.raman007@gmail.com

 

PG and Research Department of Commerce

Kanchi Mamunivar centre for PG studies

[Affiliated to Pondicherry Central University]

Lawspet , Pondicherry-605008

India

 

 

Abstract

This paper is to examine the savings and investment behaviour of college faculty members in Puducherry region. This study deals with investors’ preference of Shares, Debentures, Mutual fund, Bank deposits and Life insurance etc. The investigation is conducted through primary data with a sample of 113 respondents from Puducherry region. The convenience sampling technique has been used for the study. The core objective of this study is to find out saving preference of investors about different investment avenues. The perception of investment and investors’ awareness of investment avenues have been analysed and interpreted. The data has been collected through structured interview schedule from the selected respondents. Chi-square, MANOVA (Multivariate analysis of variance), Correlation and percentage analysis have been used for analysis. The results of the study show that MANOVA age, gender, education, marital status and income shows highly significant towards investment preferences and correlation inferences awareness towards investment avenues and education is significant, Chi square find the satisfaction level towards investment has association between age, gender, monthly income, marital status; education.

 Key Words: Investors, avenues, perception, investment, savings.

 JEL Classification:  G81, G11, G1

Empirical Analysis on Savings and Investment Behaviour of College Faculty Members in Puducherry Region

 

INTRODUCTION

This study deals with the behaviour of the investors to discover the better investment opportunities available in Pondicherry. Savings in its most simple terms is defined as an excess of income over expenditure, be it an individual or nation as a whole income is earned to meet the expenditure on consumption. Savings and investment are always equal in the actual sense however in the desired and planned sense, they are generally not equal in that case they are equal only in equilibrium. Maheswari. (2008) defines wide range of investment avenues is available to the investor. These are mainly postal office savings, bank deposits, bonds, mutual funds, real estate, pension plans, life insurance, derivatives and equity shares. All investment instruments have own return, risk, liquidity and safety. Sometime you may have more money than you want to spend at other times you may want to purchase more than you can afford based on your present income. These imbalances will lead you either to borrow or to save and maximize the long run benefit from our income. Suppose you have to invest different financial products it will simultaneously help your investment and your money.

REVIEW OF LITERATURE

 

Ananthapadhmanabha (2012) the study titled on “Saving and Investment behaviour of Teachers – an empirical study” proves most of the teachers prefer life insurance and bank deposit, PPF. Most of the teachers purpose the investment to children education and tax benefit.

Murithi, Narayanan, and Arivazhagan (2012) titled on “Investors Behaviour in various Investment avenues” in the study most of the respondents prefer to park their fund in avenues like bank, life insurance, mutual fund and gold.

Virani (2012)Saving and Investment pattern of School Teachers- a study with reference to Rajkot city, Gujarat” majority of teachers prefer life insurance, post office saving, Bank deposit, PPF, gold and silver.

Aparna and Burghate (2012) titled on “A study on Investment Behaviour of Middle Class Households in Nagpur” in the study most of the middle class householders preferred investment option is bank deposit and the majority of the respondents take investment decision on their own.

 

 

 

 

Prakash and Sundar (2013) the study titled on “Analysis of Investor Perception and Preferences: Investment avenues” concludes that most of the investors discuss with their family and friend before making an investment decisions and investment prefer for bank deposit, gold/silver.

Heena (2013) the study titled on “Investors Behaviour towards Investment Avenues: A Study with Reference to Indore city” result found that younger people are more interested in investment in comparison to elder and middle age people. Most of the investors prefer to risk free investment.

Bairagi and Rastogi (2013) titled on “An Empirical study of Saving Pattern and Investment Preferences of Individual Household with Reference to Pune city”  proves most of the investor given their first preference to bank deposit as the most preferred investment product and most of the investors investing reason is safety only.

 

 

 

[

Kavitha and Madhavan (2014)  the study titled on “Investors Preferences towards various Investment Avenues with special reference to Derivative market” results that most of the respondents prefer stock index future, majority of the respondents 36 per cent preferred wealth maximization instruments.

 

Koti (2014) Investors Preference towards Stock Market and other Investment Options” most of the investors prefer bank deposit, most of the stock market investors of this hubli region and many investors don’t like to invest in stock market.

 

Sood and Kaur (2015)  the study titled on “A study of Saving and Investment Pattern of Salaried Class People with Special Reference to Chandigarh” most of the teachers prefer bank F.D and Govt securities as the investment option, there are lack of awareness about other avenues like equity, and mutual fund etc.

OBJECTIVES OF THE STUDY

 

  • To assess the saving and investment preferences of college faculty members in Puducherry region.
  • To ascertain the awareness level towards various investment avenues.
  • To find out the association between demographic variables and satisfaction level towards investment.
  • To identify the factors influencing the investors to invest in various investment avenues.

 

 

HYPOTHESES DEVELOPED FOR THE STUDY

 

  • Ho1: There is no significant difference between demographic variables on investment preferences.
  • Ho2: There is no significant relationship between education and awareness about investment avenues.
  • Ho3: There is no significant association between demographic variables and satisfaction level of investments.
  • Ho1: There is no significant association between age and satisfaction level of investments.
  • Ho2: There is no significant association between gender and satisfaction level of investments.
  • Ho3: There is no significant association between education and satisfaction level of investments.
  • Ho4: There is no significant association between martial status and satisfaction level of investments.
  • Ho5: There is no significant association between monthly income and satisfaction level of investments.

 

 

RESEARCH METHODOLOGY

 

The source of the data for the study has been collected from primary sources. The study has been conducted to collect the primary data from the selected respondents from college faculty members in KMCPGS College and Tagore Arts College in Pondicherry. The study is focused on saving and investment behaviour among the college faculty members. The data has been collected during November, 2015.The total numbers of 150 questionnaire/interview schedule have been served to the respondents, 37 respondents has not provided appropriate information, finally 113 respondents are included for the analysis. The convenience sampling method has been and data collected through interview schedule from the selected respondents. Chi-square, MANOVA, Correlation, and percentage analysis have been used for data analysis and interpretation. SPSS 16. Version software has been used for data analysis.

Table 1

 Demographic profile of Respondents

 

STATUS

RESPONDENTS

PER CENTAGE %

Gender

 

 

Male

Female

63

50

55.8

14.2

Total

113

100

Age

 

 

Below 25 years

25 to 35 years

36 years 45 years

46 to 55 years

Above 55

 2

14

18

35

44

 1.8

12.4

15.9

31.0

38.9

Total

                     113

100

 

Education qualification

 

 

 

M.Phil

Ph.D

NET

    9

101

    3

 

8.0

89.4

  2.7

 

Total

113

100

Marital status

 

 

Single

Married

Divorced

Widow

  7

94

  9

  3

 6.2

83.2

 8.0

 2.7

Total

113

100

Monthly  income

 

 

Less than `50000

`50001 to `100000

`100001 to `150000

Above `150000

7

26

40

40

 6.2

23.0

35.4

35.4

Total

100

100

 

Table 1 shows that 55.8 per cent respondents are male and 44.2 per cent are female. The highest percentage of the respondents is 38.9 per cent which is above 55 years age group followed by 31 per cent comes between 46-55 years, 15.9 per cent belong to 36-45 years of age, 12.4 per cent belong to 25-35 years, and remaining 1.8 per cent belongs to below 25 years. The education of the respondents having 89.4 per cent as Ph.D. Degree holders followed by 8 per cent M.Phil, and 2.7 per cent NET. In marital status 83.2 per cent respondents are married, 8 per cent are divorced, 6.2 per cent are single and remaining 2.7 per cent are widow. The monthly income of the respondents 35.4 per cent respondents are above `1,50,000 and  `1, 00,000 to ` 1, 50,000, 23 per cent ` 50,000 to`1, 00,000  and  remaining 6.2 per cent respondents  are less than ` 50000.

Table 2

Investment Preferences

 

Investment preferences

S.n

Avenues

 

Rank

1

R

2

R

3

R

4

R

5

R

6

R

7

R

8

R

9

R

10

Mean square

 

Rank

1

Post office saving  

23

20

25

12

16

11

3

0

3

0

7.80

3

2

Life insurance

10

41

23

20

13

6

0

0

0

0

8.35

2

3

PF

0

18

19

21

24

20

7

2

2

0

6.16

4

4

GPF/CPF

64

15

10

5

5

6

4

2

0

2

9.46

1

5

Real estate

3

5

3

9

17

19

34

12

5

6

4.42

7

6

Gold /silver

6

7

18

27

18

24

11

0

2

0

5.41

5

7

Bank deposit

9

7

6

12

14

16

39

7

3

0

4.52

6

8

Mutual fund

0

0

3

5

2

0

11

52

23

13

3.36

8

9

Equity Shares

0

0

2

2

4

8

2

24

54

17

3.06

9

10

Derivative

0

0

0

0

0

3

0

14

21

75

2.38

10

 

Table 2 the above ranking technique shows that, mean square value is 9.46 so respondents highly preferences to invest in GPF/CPF (General Pension Fund, Central Provident Fund), next most preferred instrument (8.35 mean square) is life insurance, respondents preferred rank 3 (7.80 mean square) is post office saving, rank 4 (6.16 mean square) is provident fund, rank 5 (5.41 mean square) is gold and silver, rank 6 (4.52 mean square) is bank deposit, rank 7 (4.42 mean square) is real estate, rank 8 (3.36 mean square) is mutual fund, rank 9 ( 3.06 mean square) is equity share and finally  rank 10 ( 2.38 mean square) is derivative because most of the respondents not aware of derivative respondents mostly prefer GPF/ CPF. Post office saving, Life insurance main purpose is this investment instrument helpful of tax concession.

 

 

  1. Analysis of saving and investment preferences of college faculty members in Puducherry region.

Influence of investors’ demographic variables (Independent variable) and investment preference  (Dependent variable) were analysed with MANOVA the demographic variables like age, gender, martial status, monthly income, education on investment preferences towards the various investment alternatives has been considered for analysis

Table 3

Multivariate test

Effect

Value

F

Hypothesis df

Error df

Sig.

Intercept

 

Pillai's Trace

1.000

1.319E5a

11.000

75.000

.000

Wilks' Lambda

.000

1.319E5a

11.000

75.000

.000

Hotelling's Trace

1.935E4

1.319E5a

11.000

75.000

.000

Roy's Largest Root

1.935E4

1.319E5a

11.000

75.000

.000

Gender * Age * Marital status * Education quail * Monthly income*

 

Pillai's Trace

6.780

5.059

297.000

935.000

.000

Wilks' Lambda

.000

7.760

297.000

797.561

.000

Hotelling's Trace

45.319

11.167

297.000

805.000

.000

Roy's Largest Root

14.694

46.258b

27.000

85.000

.000

Source: Primary Data

Table 4

 

 Tests of Between-Subjects Effects

Independent variables

Dependent Variable (Investment preferences to  different Avenues)

Type III Sum of Squares

df

Mean Square

F

Sig.

Gender * Age *Marital status *Education quail *Monthly income

Post office saving

Life insurance

Public provident fund

GPF/CPF

Real estate

Gold/silver

Bank deposit

Mutual fund

Equity shares

Derivative

281.316

116.198

184.355

330.075

252.677

189.914

373.793

148.977

163.185

  79.042

27

27

27

27

27

27

27

27

27

27

10.419

   4.304

   6.828

12.225

   9.358

   7.034

13.844

   5.518

   6.044

   2.927

6.033

4.032

4.291

5.511

3.929

4.202

8.816

2.284

5.315

19.099

.000

.000

.000

.000

.000

.000

.000

.000

.000

.000

Table 3 depicts that age, gender, education, marital status and income shows highly significant towards investment preferences at 1% level of significance it means demographic variables all affects the investment preferences. From the above table we can see that the value of MANOVA is less than .01 therefore H01 is rejected. Thus there is a significant difference between demographic variables and investment preferences

  1. Analysis of awareness level towards various investment avenues.

  Table 5

  Correlations

 

III. To ascertain the Association between Demographic variables and Satisfaction level towards Investment

Satisfaction level

Age

Extremely

Satisfied

Cannot say

Not satisfied

Total

Below25 years

0

2

0

0

2

25 -35 years

0

10

4

0

14

36 – 45 years

0

16

0

2

18

46-55 years

10

22

3

0

35

Above 55

15

26

0

3

44

Total

25

76

7

5

113

Degree of freedom

12

Calculated value

33.417

Table value 5per cent level

21.025

Table 6 depicts that the calculated value of chi-square 33.417 is more than the table value 21.025 at 5% level of significance, that there is a significant association between the age and satisfaction level about investment. Hence “Ho3.1 There is no significant association between age and satisfaction level of investments is rejected”.

 5.1 Association between Gender and a Satisfaction level

Table 6.1

Satisfaction level

Gender

Extremely

Satisfied

Cannot say

Not satisfied

       Total

Male

9

44

5

5

63

Female

16

32

2

0

50

Total

25

76

7

5

113

Results of the chi-square test

Degree of freedom

3

Calculated value

8.78

Table value 5 per cent level

7.815

Table 6.1 shows that the calculated value of chi-square 8.78 is more than the table value 7.815 at 5% level of significance, that there is a significant association between the gender and satisfaction level about investment. Hence “Ho3.2 There is no significant association between gender and satisfaction level of investments is rejected”.

5.2 Association between Education and Satisfaction level

Table 6.2

Satisfaction level

Education

Extremely

Satisfied

Cannot say

Not satisfied

Total

M.Phil

0

6

3

0

9

Ph.D

25

67

4

5

101

NET

0

3

0

0

3

Total

25

76

7

5

113

Degree of freedom

6

Calculated value

15.756

Table value 5 per cent level

12.592

Table 6.2 depicts that the calculated value of chi-square 15.756 is more than the table value 12.592 at 5% level of significance, that there is a significant association between the education and satisfaction level about investment. Hence “Ho3.3 There is no significant association between education and satisfaction level of investments is rejected”.

 5.3 Association between marital status and satisfaction level

Table 6.3

Awareness level

marital status

Extremely

Satisfied

Cannot say

Not satisfied

Total

Single

2

5

0

0

7

Married

20

62

7

5

94

Divorced

3

6

0

0

9

Widow

0

3

0

0

3

Total

25

76

7

5

113

Source: Primary Data

Results of the chi-square test

Degree of freedom

9

Calculated value

4.283

Table value 5 per cent level

16.919

 

Table 6.3 shows that the calculated value of chi-square 4.283is more than the table value 16.919 at 5% level of significance, that there is a significant association between the marital statues and about investment .Hence “Ho3.4 There is no significant association between marital status and satisfaction level of investments is rejected”.

5.4 Association between Monthly income and Satisfaction level

Table 6.4

Satisfaction level

monthly income

Extremely

Satisfied

Cannot say

Not satisfied

Total

Less than  `50000

0

5

2

0

7

`50001-`100000

3

20

0

3

26

`100001-`150000

3

30

5

2

40

Above `150000

19

21

0

0

40

Total

25

76

7

5

113

Source: Primary Data

 

Results of the chi-square test

Degree of freedom

9

Calculated value

37.802

Table value 5 per cent level

16.919

 

The analysis shows of table 6.4 that the calculated value chi-square of 37.802 is more than the table value 16.919 at 5% level of significance, that there is a significant association between the monthly income and satisfaction level about investment. Hence “Ho3.5 There is no significant association between monthly income and satisfaction level of investments is rejected”.

  1. Factor influencing of Investment

Table 7

Sl.no

Statement

Respondents

Percentage

1

Low risk

13

11.5

2

Liquidity

  0

    0

3

High rate of returns

  0

    0

4

Safety

43

38.1

5

Tax concession

57

50.4

Total

113

100

           Source: Primary Data

Table 7 shows that, 50.4per cent of the respondents want tax concession, 38 per cent of the respondents want safety, 11.5 per cent of the respondents want low risk and no respondents of liquidity and high rate of return.

  1. Awareness about Investment avenues.

Table 8

S.l.no 

Avenues

Good aware

Aware

Moderate

Unaware

Totally unaware

1

Postal office savings

84

22

7

0

0

2

Life insurance

56

50

7

0

0

3

PPF

56

47

7

0

3

4

GPF/CPF

87

26

0

0

0

5

Real estate

50

23

30

7

3

6

Gold & silver

71

26

11

3

2

7

Bank deposit

70

34

7

2

0

8

Mutual fund

21

26

35

24

7

9

Equity shares

9

34

39

22

9

10

Derivatives

5

12

30

47

19

     Source: Primary data

Table 8 shows that, 87 per cent respondents are having good awareness about GPF/CPF, 47 respondents are having  aware about PPF, 39 respondents are having moderate aware about  equity shares and 47  respondents are having unaware about derivatives.

 

 

 

RESULTS AND DISCUSSIONS

  • Majority of the respondents 55.8 per cent are male than female 44.2 per cent.
  • Most of the respondents are in the age of above 55 years 38.9 per cent than 46-55 years 31 per cent.
  • Majority of the respondents’ education qualification is Ph.D 89.4 per cent.
  • Majority of the respondents are marital status is married 83.2 per cent.
  • Most of the respondents’ monthly income is above `15000004 per cent.
  • Most of the respondents are investment experience is moderate 43.4 per cent.
  • Most of the respondents are investing 10 to 20% of their portion of income 50 per cent.
  • Most of the respondents are involved between the periods of investing for above 10 years 43.4 per cent.
  • Majority of the respondents are investing monthly in the investment 87.6 per cent.
  • Most of the respondents are risk taking capacity is medium 48.7 per cent.
  • Most of the respondents get advice from their family 49 per cent.
  • Majority of the respondents are investment purpose is tax concession 52.2 per cent.
  • Majority of the respondents are is highly satisfied of investment 67.3 per cent.
  • Majority of the respondents are investment preferences is GPF/CPF then 87 per cent respondents are having good awareness about GPF/CPF.

Hypotheses

Statistical Tool

Result

H0 Accepted/

Rejected

Ho1There is no significant difference between demographic variables on investment preferences.

 

 

MANOVA

Since the P value of the test is less than (<0.01)

 

H01 is rejected

Ho2: There is no significant relationship between education and awareness about investment avenues.

 

Correlation

Since the P value of the test is less than (<0.05)

 

H02 is rejected

Ho3: There is no significant association between demographic variables and satisfaction level of investments

Ho3.1: There is no significant association between age and satisfaction level of investments.

 

Chi -square

Since the P value of the test is less than (<0.05)

 

H03.1 is rejected

Ho3.2: There is no significant association between gender and satisfaction level of investments

 

Chi -square

Since the P value of the test is less than (<0.05)

 

H03.2 is rejected

Ho3.3: There is no significant association between education and satisfaction level of investments

 

Chi -square

Since the P value of the test is less than (<0.05)

 

H03.3 is rejected

Ho3.4: There is no significant association between martial status and satisfaction level of investments

 

Chi -square

Since the P value of the test is less than (<0.05)

 

H03.4 is rejected

Ho3.5: There is no significant association between monthly income and satisfaction level of investments

 

Chi -square

Since the P value of the test is less than (<0.05)

 

H03.5 is rejected

SCOPE OF THE STUDY

 

  • The study mainly focused on the investment avenues which preferred by the college faculty members.
  • To identify investment behaviours of college faculty members.
  • The analysis is basses on the faculty members having awareness level about various investment avenues.

LIMITATIONS OF THE STUDY

 

  • The study is limited to Pondicherry region only
  • The sample size is has been for study considered only 113 respondents.
  • The study is mainly focused on limited financial product only
  • The study has been focused on only for college faculty members.
  • The data has been collected only two educational institutions in Puducherry.

 

SUGGESTIONS

  • Most of the faculty members prefer GPF/CPF, life insurance and PPF as the investment avenues, there is lack of awareness about other avenues like equity, mutual fund and derivatives.so if they want to invest in them they should regularly read newspaper, journals and articles related to share market.
  • The investor has to attended online trading programs to take efficient investment decisions.
  • Investors may start investing in stock market since the SEBI regulated the stock market, BSE (Bombay stock exchange), NSE (National stock exchange) and government of India in providing lot of support and encouragement to the general public.
  • Investors may take high risk in investment to earned high return in investment.

 

 

CONCLUSION AND POLICY IMPLICATIONS                                                       

This study confirms that more significant different between age, gender, education, marital status and income shows highly significant towards investment preferences is significant at 1% level of significance it means all demographic variables affects the investment preferences. Most of the respondents prefer GPF/CPF, life insurance; postal office and awareness towards investment avenues and education have significant relationship is significant. Satisfaction level towards investment has association between age, gender, monthly income, marital status; education is significant association at 5% level of significant finally the most of the faculty members are saving their money for children’s education, marriage and most of faculty members investing reason for tax concession also.

REFERENCES

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  • Bairagi, Ujwala and Rastogi, Charu. (2013). “An Empirical Study of Saving Pattern and Investment Preferences of Individual Household with Reference to Pune City”. International E-Journal of Ongoing Research in Management and IT.IV, Issue.2.pp.1-11.
  • Bhalla, V. K. (2008).Investment Management.14th New Delhi: S. Chand & Company Ltd: pp.491-572.
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  • Samudra, Aparna and Burghate, M.A. (2012). “A Study on Investment Behaviour of Middle Class Households in Nagpur”. International Journal of Social Sciences. Vol, 1, Issue.5, May, pp.43-53.
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