Behavioral Biases in Mutual Fund Investments: A Study using AMFI and SEBI

IPEM Journal Management > Behavioral Biases in Mutual Fund Investments: A Study using AMFI and SEBI

Behavioral Biases in Mutual Fund Investments: A Study using AMFI and SEBI

Dr. Sachin, Mr. Amit Yadav,

Vol 20 , Issue 1 , July 2026 | Pages: 17-23

DOI: 10.61691/IPEM_Mgmt.20.2026.17-23

Published Online: July, 2026

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Author Details

  1. Dr. Sachin1 Associate Professor, Dr. Akhilesh Das Gupta Institute of Professional Studies, New Delhi, Email: sachinjindal50@gmail.com
  2. Mr. Amit Yadav2, Research Scholar, Management Discipline, IGNOU, New Delhi

The Indian mutual fund industry has experienced substantial growth over the past decade, driven by increasing financial inclusion, digital investment platforms, and regulatory reforms. Despite this expansion, investor decision-making continues to be shaped by psychological and emotional factors that deviate from rational finance assumptions. This study examines the role of behavioral biases in mutual fund investment behaviour in India using a Systematic Literature Review (SLR) and secondary data reported by the Association of Mutual Funds in India (AMFI) and the Securities and Exchange Board of India (SEBI).

Using industry-level data up to October 2025, the study analyses trends in Assets under Management (AUM), Systematic Investment Plan (SIP) inflows, fund category preferences, and redemption behaviour. The findings reveal that although AUM reached approximately Rs. 79.87 lakh crore and monthly SIP inflows surged to Rs. 29,529 crore, investor behaviour remains influenced by herding, recency bias, overconfidence, loss aversion, and panic-driven decision-making during periods of market volatility. The study integrates Prospect Theory and behavioural finance models to explain observed investment patterns. The research highlights the need for enhanced behavioural literacy, regulatory nudges, and simplified disclosures to promote long-term, disciplined mutual fund investing. The study contributes to behavioural finance literature by providing an India-specific, regulator-backed empirical perspective suitable for policy and academic discourse.

Keywords: Behavioral Finance, Mutual Funds, AMFI Data, SEBI Reports, Herding Behaviour, Recency Bias, Overconfidence, SIP Behaviour, Loss Aversion, Investor Psychology

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