“How many millionaires do you know who have become wealthy by investing in savings accounts? I rest my case.”
– Robert G. Allen

Indian households’ preferred financial assets are bank deposits, life insurance, precious metals, post-office savings and real estate. Traditionally households were looking for safe investment options. The second reason why other financial assets have not gained importance is the lack of financial literacy among the people. Securities Exchange Board of India (SEBI), National Stock Exchange (NSE), Bombay Stock Exchange had empanelled resource persons to spread financial literacy across states.

In order to study the investment behaviour of investors SEBI Investors Survey 2015 was commissioned in the year 2015 and the survey was completed in the year 2018. The result of the survey was revealed by SEBI in the month of August 2019. The survey initially included 2,04,694 households and the demographic details were collected. In the second stage 50,453 households were chosen for the final survey. The respondents include both urban and rural households.
The findings which are similar to both urban and rural include:
· More than 95% of the households prefer to invest in bank deposits
· The second most preferred sector for investment was life insurance.
· Precious metal was the third most preferred investment followed by post office savings and real estate.
· Mutual funds emerged at the sixth place; stocks occupied the seventh place followed by pension schemes, company deposits, debenture, derivatives and commodity futures as preferred investment vehicles for the urban household.
· Among the rural households less than 1% of the respondents were investors and also the awareness about equity and mutual funds was only 1.4%.
· However 75% of the investors participated in the survey were first time investors. So on a positive note; it is found that the investor base is increasing in India.
· Middle income people save more as a percentage of their annual income compared to the high income people.
· The primary motivation to save in securities market is capital gain followed by life style improvement plans.
· Among the surveyed, the equity investors constituted of 23% government employees, 11% private employees and 17.5% business owners.
· 15% of the survey respondents are investors and 18% of the survey respondents have invested in equities.
· The top sources of IPO news is newspapers and television.
· Most interestingly, the survey results showed that perceptions of risk, return and liquidity are not similar with their actual risk, returns and liquidity profile.
· Investors considered bonds and debenture as highly risky compared to mutual funds and equities due to their lack of awareness level.

The survey proved that both urban and rural households still prefer to invest in traditional assets over new alternative investments. There are two major factors that impact the investments of the households. Households prefer to invest in assets which are less risky and secondly lack of awareness about modern instruments made them to continue with the existing choices.