Article’s

Classical finance theory assumes investors process information rationally and act to maximise expected utility, yet a substantial behavioural-finance literature shows that psychological biases systematically shape real investment decisions. This study examines the influence of common behavioural biases, namely overconfidence, herding, loss aversion and the disposition effect, on the investment decisions and self-reported satisfaction of individual retail investors in Bengaluru. A structured five-point Likert questionnaire covering demographic, investment-behaviour and bias-related statements was administered to 150 individual equity and mutual-fund investors. A one-sample t-test confirms that the composite bias-influence score (M = 3.71, SD = 0.34) is significantly above the neutral midpoint (t = 25.86, p < 0.001), indicating that respondents recognise behavioural biases as a material influence on their own investment decisions. One-way ANOVA found a significant difference in bias-influence scores across income groups (F = 3.128, p = 0.016) but not across investing-experience bands (F = 1.104, p = 0.351). Pearson correlation found a significant positive relationship between self-reported overconfidence and trading frequency (r = 0.34, p < 0.001), and a significant negative relationship between risk tolerance and portfolio diversification (r = −0.21, p = 0.010), while a supplementary multiple regression of investment satisfaction on four bias dimensions was significant overall (R² = 0.187, F(4,145) = 8.34, p < 0.001), with loss aversion and herding emerging as the strongest individual predictors. No significant gender difference was found (t = 1.12, p = 0.264). The findings indicate that behavioural biases are a recognised and measurable influence on retail investment behaviour in this sample, vary systematically with income, and are more closely tied to trading and diversification patterns than to demographic profile alone. The study recommends structured investor-education interventions targeted at high-income, high-turnover investor segments and closer integration of behavioural coaching into financial-advisory practice.