Comparing Investor Behavior During and After Pandemic Era: Dominantly Rational or Irrational Driven?

DOI

10.2991/978-2-38476-204-0_15How to use a DOI?

Keywords

Investors’ behavior; rational factors; irrational factors; covid-19 pandemic; the economic recovery

Abstract

This study is conducted to compare investors’ decision-making behavior between two periods, during pandemic and during recovery period in Indonesia. Our focus is on the rationality and irrationality factors that explained their decision-making. We examine the differences of the behavior between during the covid-19 pandemic and during the economic recovery era. This study is comparing the correlation of investors’ rationality factors and irrationality factors on stock market return between two periods, during pandemic and during recovery period. Using Spearman Rank Correlation analysis, we examine the correlation of each factors on stock market return. Our empirical results showed that rationality and irrationality factors correlated significantly with the stock return during the pandemic and during the economic recovery era. However, this study couldn’t find significant correlation each factor in each of situation separately, during pandemic period and during recovery period. The results contribute to the importance of reasons and emotions for stock-market returns. We believe this study is contributing various insights to many financial market’s stakeholders. The results of the study can help investors and traders to identify various factors affecting their trading during pandemic, support managers to make better investment decision making during uncertain situation, and support stock exchanges and regulators to make policy adjustment by considering irrational factors.

Copyright

© 2023 The Author(s)

Open Access

Open Access This chapter is licensed under the terms of the Creative Commons Attribution-NonCommercial 4.0 International License (http://creativecommons.org/licenses/by-nc/4.0/), which permits any noncommercial use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license and indicate if changes were made.

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TY  - CONF
AU  - Dwiyani Sudaryanti
AU  - Mohamad Bastomi
PY  - 2024
DA  - 2024/03/25
TI  - Comparing Investor Behavior During and After Pandemic Era: Dominantly Rational or Irrational Driven?
BT  - Proceedings of the 2nd International Conference on Multidisciplinary Sciences for Humanity in Society 5.0 Era (ICOMSH 2022)
PB  - Atlantis Press
SP  - 180
EP  - 189
SN  - 2352-5398
UR  - https://doi.org/10.2991/978-2-38476-204-0_15
DO  - 10.2991/978-2-38476-204-0_15
ID  - Sudaryanti2024
ER  -