Assessing The Effect Of Behavioural Biases On Gold ETF Investment Preferences Among Generation Y Investors

This study aims to assess how behavioural biases influence the investment preferences of Generation Y investors towards Gold Exchange Traded Funds (ETFs). As traditional finance increasingly integrates behavioural insights, understanding how cognitive and emotional biases shape investment choices has become vital—especially among the younger, tech-savvy generation of investors. Focusing on seven well-established behavioural biases, this research seeks to determine their impact on the preference for gold ETFs as a modern investment avenue. Primary data was collected through a structured questionnaire administered to individual investors belonging to Generation Y. Of the 300 distributed questionnaires, 258 valid responses were considered for analysis. The data was subjected to a reliability test to ensure internal consistency, followed by regression analysis to evaluate the effect of each behavioural bias on gold ETF investment preferences. The analysis revealed that all seven biases significantly affect investment decisions, with mental accounting bias and overconfidence bias emerging as the most influential. The findings suggest that Generation Y investors are not entirely rational in their financial decision-making and are susceptible to various psychological influences when selecting gold ETFs as an investment option. These insights hold substantial implications for financial advisors, investment planners, and policymakers aiming to understand and guide young investors more effectively. The study highlights the importance of integrating behavioural finance concepts into financial education and advisory services to promote more rational and informed investment behaviours among Generation Y.