Behavioral factors influencing retail investors’ decision making during the COVID-19 pandemic: A study on the Philippine stock exchange

• Main Authors: Jacaria, Justin Martin Meneses, Paredes, Ma. Isabel Anacleta San Jose, Quismorio, Matthew Jeremy Sacdalan, Exconde, Gonzalo Philip Centennial Caligagan
• Format: text
• Language: English
• Published: Animo Repository 2021
• Online Access: https://animorepository.dlsu.edu.ph/etdb_finman/3; https://animorepository.dlsu.edu.ph/context/etdb_finman/article/1006/viewcontent/_Final_Submission__Group_6_Chapters_1_to_6.pdf
• Institution: De La Salle University

This study determined the impact of behavioral factors on retail investors’ decision making during the COVID-19 pandemic. The study used 4 groups of behavioral factors which are the following: Heuristic Theory, Prospect Theory, Market Factors, and Herding Theory. The sample size is 154 retail investors residing in Makati, Parañaque, and Quezon City, covering the period, January 2020 to October 2020. In this study, data was collected through an online survey using a 6-point likert scale. It was then tested in a software called Statistica in order to analyze the data using Mean Analysis and Normalization. Overall, behavioral factors are influential towards the decision-making of retail investors with the Fluctuation in the Stock Index showing the most impact. It was also shown that the COVID-19 pandemic does bring out irrational behavior out of investors, in the sense that their irrationality causes them to behave extremely careful and rational.