The Influence of Social Media on Investment Decisions: A Behavioural Finance Perspective in Hyderabad City

Abstract

The study of finance has evolved significantly, yet behavioural finance—an area that explores the psychological factors influencing financial decision-making—remains an emerging field with substantial research potential. With the proliferation of social media, which has become an indispensable part of modern life, its influence on various aspects of financial markets warrants deeper investigation. While prior research has explored social media’s role in predicting market movements, limited studies examine its direct impact on investment decisions.
This study aims to bridge this research gap by analyzing the extent to which social media influences investment decisions, specifically within the context of Hyderabad City. Using a quantitative methodology, primary data was gathered through structured questionnaires administered via Google Forms. The collected data was systematically analyzed using Microsoft Excel to identify key trends and relationships. The study evaluates three critical dimensions: information dissemination on social media, online community behavior, and the perceived corporate image—all of which contribute to shaping investor decisions.
The findings establish a significant relationship between social media activity and investment choices, highlighting how digital platforms shape investor sentiment and decision-making processes. This research contributes to the existing literature by offering empirical insights into the intersection of social media and behavioural finance, particularly within the Indian financial ecosystem. The study provides a foundation for future academic inquiries into how digital engagement influences capital market dynamics, thereby aiding policymakers, financial analysts, and investors in understanding the evolving landscape of financial decision-making in the digital era.