MAPPING RISK-RETURN PERCEPTIONS ACROSS INVESTMENT TYPES: SOCIO-DEMOGRAPHIC INSIGHTS FROM GUJARAT STATE USING NON-PARAMETRIC METHODS

Abstract

This study examines how investor demographics (gender, age, income, education, occupation, and region) influence perceived risk and return of various investment types in Gujarat, India. We surveyed 573 investors about their risk-return ratings for bank deposits, post office schemes, mutual funds, equity shares, debt fund instruments, precious metals (gold/silver), and real estate. Using Mann-Whitney U and Kruskal-Wallis tests, we tested for differences in perceptions across demographic groups. Results show that government-backed schemes (fixed deposits and post office savings) are viewed as the safest but with the lowest returns, whereas equity shares are seen as highest risk with the highest return. Notably, perceptions for mutual funds and shares vary significantly by demographics – age, income, occupation, and gender all influence these ratings. These findings underline distinct socio-demographic segmentation in investor attitudes. Therefore, personalized financial literacy initiatives and product designs tailored to different demographic segments are needed to align investment offerings with investors’ risk preferences.