Investor’s Behaviour and Risk Perception in Mutual Funds – A Study of Retail Investors in Raipur City, C.G.

The impact of risk perception, financial literacy, knowledge, and return expectations on the investment behavior of retail mutual fund investors in Raipur, an Indian tier-2 city, is investigated in this study. Purposive sampling was used to gather information from 100 retail investors, both current and prospective, using a standardized questionnaire. A 5-point Likert scale was used to measure the constructs, and Jamovi's multiple linear regression and descriptive statistics were used for analysis. Higher return expectations significantly enhance willingness to take risk (? = 0.250, p =.013), but risk perception has the biggest negative influence on risk-taking behavior (? = ?0.747, p <.001). Both financial literacy (? = 0.435, p <.001) and mutual fund knowledge (? = 0.405, p <.001) significantly predict rational investment behavior. Rational behavior is nevertheless low (Mean = 2.75) despite relatively high awareness (Mean=3.85), suggesting a large knowledge-practice gap. The findings highlight how mutual fund investment decisions in developing urban India are primarily influenced by psychological and informational factors rather than demographic ones. To encourage disciplined, long-term investing, practical suggestions include mandated investor education, open risk information, and behavioral nudges on digital platforms.