In december 2019, the first cases of covid-19 were reported in Wuhan, China. Since then, the virus has spread rapidly around the world. In order to try to stop the spread of the virus, isolation has become actual. Except affecting the public health, the virus has caused deep traces in the global economy. A clear stock market fall on the Swedish stock exchange could be observed in February-March 2020. The financial crisis that has arisen is the first crisis many of the young investors, of the age 18–30 years old have to manage. Due to the economic crisis that has arisen, this study aimed to describe young investors' decision-making in the financial market during the period 1 January 2020 to 5 May 2020. The research question goes as follows: What factors influence young investors' decision-making in the financial market during an economic crisis? The study was conducted on the basis of the Theory of Behavioral Finance. This theory assumes that the individual's decision-making in the financial market is largely influenced by emotions and other psychological factors. Furthermore, the theory is based on a number of different assumptions about human psychological and behavioral phenomena that influence investment decisions. The procedure for conducting the study was to make a descriptive quantitative study. This meant that a questionnaire was passed on to young investors and that the answers were then compiled in diagrams and tables. The results indicated that the factors overconfidence, representativeness bias and anchoring bias seemed most likely to describe young investors' decision-making in the financial market during an economic crisis. At the same time, a reasonable interpretation seemed to be that herding behavior and risk and loss aversion cannot describe the young investors' decision-making to a large extent. The importance of mental accounting could not be determined in this context, as the answers received provided an incomplete basis for deciding this. To be able to draw conclusions about the role of mental accounting in decision-making, several issues that dealt with this would have been useful. One suggestion for continued research is to study other factors that may underlie young investors' decision-making during an economic crisis.
| Identifer | oai:union.ndltd.org:UPSALLA1/oai:DiVA.org:ltu-79279 |
| Date | January 2020 |
| Creators | Persson, Julia, Öberg, Alva |
| Publisher | Luleå tekniska universitet, Institutionen för ekonomi, teknik och samhälle, Luleå tekniska universitet, Institutionen för ekonomi, teknik och samhälle |
| Source Sets | DiVA Archive at Upsalla University |
| Language | Swedish |
| Detected Language | English |
| Type | Student thesis, info:eu-repo/semantics/bachelorThesis, text |
| Format | application/pdf |
| Rights | info:eu-repo/semantics/openAccess |
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