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Viral decisions: unmasking the impact of COVID-19 info and behavioral quirks on investment choices

Business

Viral decisions: unmasking the impact of COVID-19 info and behavioral quirks on investment choices

W. U. Rehman, O. Saltik, et al.

This study explores how behavioral biases such as investor sentiment and herding affect investment decisions, particularly during the COVID-19 pandemic. Conducted by Wasim ul Rehman, Omur Saltik, Faryal Jalil, and Suleyman Degirmen, the findings reveal that younger and less experienced investors are most prone to these biases, leading to poorer performance. Gain insights to improve your rational decision-making in crises!

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~3 min • Beginner • English
Abstract
This study investigates the impact of behavioral biases on investment decisions and the moderating role of COVID-19 pandemic information sharing. It underscores the importance of cognitive biases and sociodemographic factors for understanding investor behavior and for designing agent-based models (ABM) to simulate markets. Empirical findings show behavioral factors significantly and positively affect investment decisions, consistent with prior research. The ABM indicates younger, less experienced agents are more prone to herding and underperform relative to older, higher-income counterparts. The results offer insights into how behavioral biases and COVID-19 information sharing shape investment decisions, supporting strategies that foster more rational decision-making during crises like the COVID-19 pandemic.
Publisher
HUMANITIES AND SOCIAL SCIENCES COMMUNICATIONS
Published On
Apr 20, 2024
Authors
Wasim ul Rehman, Omur Saltik, Faryal Jalil, Suleyman Degirmen
DOI
https://doi.org/10.1057/s41599-024-03011-7
Tags
behavioral biases
investment decisions
COVID-19
herding behavior
investor sentiment
overconfidence
market performance

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