Risk, Trust, and Traditional Savings: Understanding Stock Market Aversion in a South Indian District

Abstract

Investment plays an important role in wealth creation and economic development, yet many individual investors remain reluctant to participate in the stock market. This study examines investor aversion toward stock market investment in Palakkad District, Kerala, with a focus on awareness, attitude, discouraging factors, and preferred investment avenues. Primary data were collected from 60 respondents using a structured questionnaire and convenience sampling, and were analysed using descriptive and inferential statistical techniques. The findings indicate significant differences in stock market awareness by gender, with female respondents recording a higher mean rank. Awareness of investment instruments varies significantly by age, while the difference by living place is not statistically significant. Attitude toward the stock market varies significantly by living place but not by age. Investors show a strong preference for traditional avenues, particularly bank savings, post-office savings, and gold, while equities rank lower among the alternatives considered. Fear of loss, risk perception, limited financial literacy, and reliance on familiar savings institutions emerge as important barriers to market participation. The findings suggest that targeted financial education, reliable investment information, and accessible digital and advisory support may help investors make more informed investment decisions.