A Study on Investors perception towards derivative trading

  • Unique Paper ID: 174708
  • PageNo: 1750-1761
  • Abstract:
  • Investments are motivated by the prospect for returns, which carry with it the stigma of risk. Investors are often faced with choices about investment alternatives, allocation, and risk management. Knowledge of finance is essential in making these choices. In the range of financial instruments, derivatives that include forward contracts, futures, and options provide a valuable tool for managing risk exposures. Derivatives get their value from underlying assets and are important elements of capital markets. Investor attitudes towards trading derivatives are tested in this research based on risk-return evaluations and investment patterns. Derivatives are useful vehicles for hedging against risks as well as obtaining financial goals but have the attribute of being difficult to understand. This research questions how investors hedge risks and capture returns, subject to market sentiments, regulations, stability, and liquidity. Furthermore, it asserts that investors should have adequate awareness about market drivers, regulatory policy, and incoming trends to avoid hasty investments. The study seeks to gain insights into investor attitudes, issues, and motivations for derivative investments. Results will add to a wider understanding of how risk perception affects market participation and the role of financial literacy in promoting well-informed investment choices.

Copyright & License

Copyright © 2026 Authors retain the copyright of this article. This article is an open access article distributed under the Creative Commons Attribution License which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.

BibTeX

@article{174708,
        author = {Vijay Gauswami and Gopal kumar},
        title = {A Study on Investors perception towards derivative trading},
        journal = {International Journal of Innovative Research in Technology},
        year = {2025},
        volume = {11},
        number = {11},
        pages = {1750-1761},
        issn = {2349-6002},
        url = {https://ijirt.org/article?manuscript=174708},
        abstract = {Investments are motivated by the prospect for returns, which carry with it the stigma of risk. Investors are often faced with choices about investment alternatives, allocation, and risk management. Knowledge of finance is essential in making these choices. In the range of financial instruments, derivatives that include forward contracts, futures, and options provide a valuable tool for managing risk exposures. Derivatives get their value from underlying assets and are important elements of capital markets.
Investor attitudes towards trading derivatives are tested in this research based on risk-return evaluations and investment patterns. Derivatives are useful vehicles for hedging against risks as well as obtaining financial goals but have the attribute of being difficult to understand. This research questions how investors hedge risks and capture returns, subject to market sentiments, regulations, stability, and liquidity. Furthermore, it asserts that investors should have adequate awareness about market drivers, regulatory policy, and incoming trends to avoid hasty investments.
The study seeks to gain insights into investor attitudes, issues, and motivations for derivative investments. Results will add to a wider understanding of how risk perception affects market participation and the role of financial literacy in promoting well-informed investment choices.},
        keywords = {Derivatives, Risk, Return, Investor Perception, Financial Literacy.},
        month = {April},
        }

Cite This Article

Gauswami, V., & kumar, G. (2025). A Study on Investors perception towards derivative trading. International Journal of Innovative Research in Technology (IJIRT), 11(11), 1750–1761.

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