7 Types of Indian Investors, Which One are You?

Decisions make a lot of difference in our lives. While right decisions at right time can chart a good future, wrong ones can screw things up. This holds true for our finances also. Those who intelligently plan their finances always have an edge over those who invest money in a haphazard manner and without any proper planning. But we also can’t ignore the fact that everybody learns from mistakes. It is human to err, but learning from it and not repeating the mistake is what is expected of a mature investor. Maturity comes over time. To grow up as an investor, it is important to do a self-check to understand the weaknesses and shortcomings which could help rectify them. But foremost is to understand what kind of investors are we.

7 Types of Indian Investors, Which One are You?

Must Read – Why Should You Invest Regularly? Benefits of Regular Investing

Types of Investors

Typically investors can be qualified into 7 broad categories. The first two are Rajnikanth’s of markets as they are not impacted by any market conditions. These 7 types of investors are:

1. Only Savers

The majority of investors in India are from this category. When you say equity they will look at you as if you were some Andaman tribal people lecturing on GPRS. They never invested a single penny in equities. Their answer to equity is – equity is risky so why take the risk. They are happy with what they are getting but not greatly thrilled, all the same.

2. Regular Investor

This is a rare breed. They have a long-term view over equity. They will never discuss small market events. They are also a bit mechanical in investing. They invest when they have a surplus and withdraw when in need. They are convinced over the fact that equity will beat all other investments in the long run. Generally, you feel very comfortable in their company as they understand finances & talk sensibly.

Now come the investors who are actually affected by market see-saw or roller costar rides.

3. Window shoppers

They will be the first to read or get information over an investment but they will never participate in markets. They will constantly float opinions and talk about personal finance but will not dare to risk their own money. He is the nonplaying captain who will never dare to sweat himself but would be the first one to talk about strategies.

4. Seasonal Traders

These are experienced people but who have earned nothing from the investments. These are generally close to employees of the trading houses or investing professionals. They live in a fantasy that all the “first news” comes to them. They show they are waiting for the right opportunity to make a killing in the markets. They are irregular investors and have high volumes of trade but what about earnings??… Keep guessing.

5. Scapegoats

He is basically a friend of financial product sellers. Agents complete the majority of their targets from these investors. He takes advice from all… from colleagues, panwala, fellow bus travelers, etc. Absolutely, no discrimination at all. He is a typical 9 to 5 person busy earning money and managing his daily chores thinking he would be rich someday. Brokers enjoy their money.

6. The Hi-tech Lalaji

These people are champs of their business and think that they can be successful when it comes to investing too. They suffer from “I know everything” syndrome and do not hesitate to show off there contacts. Their common reactions are – Don’t give me advice….. I have been investing before you were born…. I traded in gold when it was Rs 600 per tola…. Pay for advice? Instead, make me your partner …Thinking of meeting Jhunjhunwala ji to discuss a new idea…. They display an experience, you wish you had yourself!

7. Mr. Cool:

These investors never panic and hold their nerves at all times. They are cool and confident. They work against herd mentality and are ready to listen to others viewpoints. They take decisions of their own and stick to it. They follow a disciplined approach and rarely invest in dubious schemes. They advocate transparency and appreciate the longevity in investments.

Read – KISS strategy in financial products

The last five investor types are affected by market conditions and they re-balance as per their mentioned characteristics.

Recently we interviewed 5 such investors you can check what they replied to similar questions.

different type of investors

This article is part of “What Investors Really Want” E-book
Download & read the full Behavioral Finance Guide from here
and be a sensible investor.
 So you are in which category?? Tough question or big Confession. 🙂


    • Hi Ashwani,

      Great you shared this – people accept it or not but 90% of readers who are reading articles on TFL are either only savers or Scapegoats. And nothing to hide every investor I have met in last 10 years has moved from these steps only.(No Shortcuts)

  1. […] finally an interesting post from TFL about 7 different types of investors. I think I fall under the regular category. Check it out for yourself to see where you fall or […]

  2. Hi Hemant
    For most part of my life I have been a saver only.However I turned in to an investor for about five years when I was posted in Mumbai.Then I invested in mutual funds of UTI,Birla Sunlife,Morgan Stanley,Canara Bank and IDBI Bank.But my favourite was UTI.I just invested in some funds and forgot about them.No PAN or KYC was required for investment in mutual funds those days.There was no issue of third party cheques.In fact I made many investments in mutual funds through CITIBANK with my credit card which was being used as charge card by me.The names of fund houses have changed. Canara has become Canara Robeco, IDBI has become Principal but I am still remaining invested in my old funds.Of course the concept of SIP was not popular those days.One made additional purchases whenever one had money.The concept of ULIP was started by UTI and I had invested a lot in them as it was much different from the ULIPs which we have these days.About five years back I became a scapegoat when one of my relatives sold me one ULIP and relationship manager of my bank made me to invest me in some worthless schemes of SBI Mutual funds.Now I have again turned into a regular investor and so far I have been able to keep away from ULIP products.

  3. sir i have the following mutual fund investment:
    all sips-
    birla mnc -1000,hdfc midcap-2000,sbi emerging bussiness-2000
    icici fmcg -1000,sbi fmcg-1000,reliance banking -2000
    can robecoinfrastructure-3000
    icici focc bluchip-2000, uti opp -2000
    icici tax saver-3000, franklin india tax shield-3000

    please analyse my portfolio and give your valuble comments… i am expecting 15% returns in 15 years.

    • Its good that you are investing thru SIP but ur portfolio is way too diversified. Over diversification kills returns so it is suggested to go for maximum 4 sips.. which may consist of 5000 in Large cap, 5000 in midcap, 5000 in gold & 5000 can be put in some sector specific fund keeping in view your risk taking appetite.
      This is a general suggestion based on assumption that you are willing to diversify over various class & will continue for 10 yrs or more..

Comments are closed.