Why investors not doing basic maths?

Few years back one investor approached me. He wanted to park his Rs. 10 Lakh in equity market. He asked me to suggest few shares. When I said a share which costs more than Rs. 1000 he said no , and he wanted to invest only shares below Rs.10. I was confused and I asked logic behind this strategy. He said these penny stocks will increase price sooner than the expensive shares. Remember he was an educated person. I had nothing more to say. What ever shares i recommended above 1000, or above 100 he refused.  For him fundamentals means a share worth Rs.10.

Recently i showed the growth all these expensive stocks made in last 7-8 years. It was amazing. But still my educated chap was not ready to digest. Still he wandering for those penny stocks.