The purpose of this paper is to systematically review the literature published on various aspects of risk perception about equity investment. It also aims to raise specific questions for future research. A comprehensive and systematic literature review is done to get the insights of the available literature with an objective to identify the determinants of equity-share-related risk perception and identify its impact that influences equity investment behavior. The study found that risk perception can be measured mainly by using the axiomatic approach, socio cultural group approach, emotional reactions, marketing mix approach, and psychometric approach. It is also found that the main determinants of risk perception are demographic factors, emotional reactions, economic crisis, framing effects, loss aversion, heuristics, etc., which leads to some impact on investment behavior such as good portfolio choice, market-linked investment, entrepreneurial success, and retirement planning. A better understanding of risk perception will help the policymakers to improve the risk perception level of investors, which in turn will help in improving the investment culture of the nation.
Keywords: risk, risk perception, equity investment, risk aversion, risk propensityThe Effect of Global Financial Crisis on ASEAN Growth: Evidence From Stock Market Analysis
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