For small and marginal investors, managing their investments is like managing any enterprise. They apply all their skills, knowledge and expertise in managing their money to get the best from investments. Despite all efforts, some cognitive and psychological factors affect their decisions. This study proposes to identify the major psychological biases that influence the individual investors' behavior and that, in return, may drive a momentum effect in stock returns. In this study, survey approach has been used to achieve this objective. The study used a structured questionnaire in which potential investors were asked for their reactions to some specific situations. The study was undertaken within the geographical area of Delhi and National Capital Region (NCR). The results revealed some psychological and cognitive peculiarities. It was interesting to find that the individual investors' behavior is driven by some psychological factors such as conservatism, under confidence, opportunitism, representativeness and informational inferiority complex. The results of the study are helpful in understanding the hidden aspects of individual investors' behavior.

For ages, money has been the pivotal factor of all human activities. Savings and investment are some of the most important monetary action tools to make money. People earn money, save a part of it and then invest this money to make more money. The basic objective of investment is to get good returns from it. They manage their investment in the best possible way to attain this objective. They seek expert advice, observe trends and collect the relevant information from various sources. For small and marginal investors, managing their investments is like managing any enterprise. He/she applies all his/her skills, knowledge and expertise in managing his/her money to get the best from their investments.

For a long time, the investors' full rationality has been a major consideration by most academicians in financial research. Rationality hereby refers to two main factors, i.e., the exhaustive and objective treatment of available and potential information. It means that investors are said to be perfectly rational and supposed to make investment decisions objectively using all the available information. In fact, it is usually supposed that stock prices are determined by rational investors' anticipations and reactions. In real financial paradigm, the existence of some irrational investors' reactions has been identified; these irrational reactions deviate investors from making rational decisions. Due to its simplicity and its success to capture the stock price movements, the famous Efficient Market Hypothesis (EMH) has for a long time been supported by the financial academic researchers. Nevertheless and since a newer concept, popularly known as behavioral finance has evolved in finance literature, the financial academic researchers' enthusiasm for this hypothesis has become much weaker. Several factors are held responsible for this change from traditional finance paradigm to the newer behavioral aspect of finance. Von Neumann and Morgenstern (1944) gave some relevant psychological findings that assert the natural and evident irrationality of human beings. The result of other studies by Kahneman and Amos (1974, 1979) also supported the irrational behavior of investors. The results of these studies reveal that any person's investment decision is affected by all sorts of inevitable cognitive and emotional biases that deviate them from a fully rational behavior. This phenomenon is more relevant in case of stock market investors' behavior. Another factor that seems to be responsible for irrationality in investors' behavior is the irregularities in stock prices, particularly the momentum movement in stock prices. Fama and French (1996) and Jegadeesh and Titman (2001) found the momentum effect as a cause of irrational behavior in the stock market, although a consensual explanation for the strong momentum effect was not arrived at by several studies including those by Moskowitz and Grinblatt (1999) and Daniel and Titman (2000).

Behavioral Finance Journal, Investment Management, National Capital Region, Efficient Market Hypothesis, Behavioral Finance, Financial Markets, Indian Stock Market, Theoretical Models, Financial Intermediaries, Multivariate Techniques, Enterprise Management.