Abstract:
The investor is centralized character in an economy and stock market plays a major role of
economic growth in a country. To minimize risk of investment investor should have good
knowledge about capital market trading. This research considers about stock market
awareness of the investors. The main objective of this study is to recognize the impact of
stock market awareness on their investment. A structured questionnaire was used to reach this
objective of the survey. The sample was consisted 150 responders who invest in the Colombo
Stock Exchange. In the quantitative analysis, Likert-scale questions which describe the basic
knowledge about stock market investment were used to develop an index regarding the
awareness of the stock market. This research considers the differences in amount of
investment, according to their awareness about stock market using the independent t-test
between two groups; having awareness and not having awareness. Further, to recognize the
factors which impact for the amount of investment used multiple regression model. Highest
percentage of investors was male. 74% of investors were obtained A/L qualifications. Among
them, 18% of investors had followed extra courses regarding to share market. 87% of
investors used the savings for investment. 13% of investors were used non saving sources
such as credits and real assets. Most of the investors had other investment beside of stock
market investment. 78% of investors were concentrated on ordinary shares. According to the
index; regarding the awareness of the stock market, 12% of investors had higher awareness
about stock market and 23% of investors had medium awareness about the stock market. 70%
of investor‘s awareness was not in a satisfactory state. Independent t-test result indicates that
there hadn‘t any difference on investment amount according to awareness of investors. To
maximize investment benefit through minimize their risk; awareness of investment should be
improved. Therefore Securities and Exchange Commission ought to be involved to expand
the informal educational ways which are familiar to investors.
