How did the financial investment behavior of Swedish retail investors change after the outbreak of COVID-19?

Sammanfattning: The aim of this thesis is to investigate how the financial investment behavior of retail investors in Sweden has changed after the outbreak of the COVID-19 pandemic. The first part of the method used to investigate this consists of collecting data using a survey that was filled out by investors. The second part of the method includes comparing and analyzing the data and interpreting it into results. The result that is found from the survey is that retail investors have changed their investment behavior in various ways after the COVID-19 outbreak compared to before. Investors claim to have become more knowledgeable about investing, they invest more frequently and a larger share of their income. The allocation of investors' portfolios seems to have changed and many investors have turned from stocks and stock funds to cryptocurrencies. Investors’ risk-taking behavior has increased when it comes to financial investments as well as the general optimism regarding this. Many investors also claim to have changed their behavior because of the specific consequences of this pandemic crisis. When controlling for different groups, I find that middle aged men claim to have increased their knowledge about investing more than other groups after the outbreak of the pandemic. Women seem to have increased their investment rate more than men in terms of frequency and share of income invested. I also find that men have become more risk-taking than women. Older investors also appear more optimistic than younger. A discussion of the results and the observed changes is held in the presence of previous literature and applied theories. I show that some of the observed changes can be confirmed by the results from previous research. I also find that some of these changes do seem to deviate from the financial behavioral theories; flight to quality and flight to liquidity, as well as from previous research regarding what is supposed to happen during times of crisis. The fact that COVID-19 is an unprecedented crisis might help explain such deviations and thereby help confirm observations and make the results more credible. This paper contributes to the literature by investigating the changes in financial investment behavior among retail investors as opposed to professional investors. Further on, this paper contributes by exploring the Swedish market and by focusing on the ongoing COVID-19 crisis.