Impact of financial literacy on capital market participation of generation Y investors in rajasthan

Authors

  • Dr. Manisha Yadav Assistant Professor, Jaipur School of Business, JECRC University Author
  • Ms. Neha Verma Assistant Professor, Jaipur School of Business, JECRC University Author
  • Mr. Mukul Sharma Assistant Professor, Jaipur School of Business, JECRC University, Jaipur, Rajasthan Author
  • Lijy Lijit Idicula Assistant Professor, Jaipur School of Business, JECRC University Author

DOI:

https://doi.org/10.67497/ijrip.1.2.73

Keywords:

Financial literacy, capital market participation, Generation Y, investment behaviour, retail investors, Rajasthan

Abstract

The study investigates the relationship between financial literacy and capital market participation of the investors belonging to Generation Y in Rajasthan. Indian retail investors are now having access to capital market products on an increased scale due to the growing adoption of demat accounts, systematic investment plans (SIPs), mutual funds, and digital trading platforms. But making access to these increases does not guarantee that investment decisions are made with sufficient knowledge. A descriptive-cum-analytical and cross-sectional research design was used to collect primary data from 400 respondents belonging to Gen Y, born between 1981-1996 using a structured questionnaire. The urban and semi-urban areas of Rajasthan were selected from the population using stratified sampling techniques. Financial literacy was evaluated using three components of financial literacy that are in line with the OECD/INFE framework, namely financial knowledge, financial attitude and financial behaviour. Demat account ownership and investment frequency, investment experience and the amount invested monthly, portfolio diversification were the indicators used to measure the participation of capital market. Descriptive statistics, Cronbach alpha, Pearson correlation, multiple regression, independent-samples t-test, one-way ANOVA and chi-square analysis were used to analyse the data. The results indicate that there was a strong and positive relationship between financial literacy and capital market activities. The financial attitude was the strongest predictor of participation followed by financial knowledge and financial behaviour. Financial literacy also controlled the significance of age and educational stream as correlates of participation, while gender and income remained significant. The study provides evidence for the role of financial literacy in facilitating informed participation in retail investment in Rajasthan, which is specific to the region.

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Published

14.08.2026

Data Availability Statement

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Issue

Vol. 1 No. 2 (2026): May-August Issue

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How to Cite

Impact of financial literacy on capital market participation of generation Y investors in rajasthan. (2026). International Journal of Research, Innovation and Practice, 1(2), 147-159. https://doi.org/10.67497/ijrip.1.2.73