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FINRA Foundation

Angelita Williams (202) 728-8988
Eric Young (703) 217-6814

New Research: U.S. Investors Unfazed by Pandemic-Related Market Volatility

African American and Hispanic Investors Showed Greatest Increase in Interest in Investing

WASHINGTON, D.C.—Despite dramatic market volatility related to the COVID-19 pandemic during early 2020, investor optimism about the stock market remained high, and one in five Americans indicated an increased interest in investing, according to a new research study by the FINRA Foundation and NORC at the University of Chicago. At the same time, low levels of investment knowledge underscore the need for additional investment education opportunities, especially among African Americans and Hispanics, the research shows.

The study results are reported in two research briefs published today in recognition of World Investor Week 2020, a global weeklong campaign held Oct. 5-11, but celebrated throughout the entire month of October due to the ongoing pandemic. The campaign seeks to raise awareness about the importance of investor education and protection.

The COVID-19 outbreak and the ensuing economic and market fallout combined to threaten the financial wellbeing of many American households during 2020. Numerous studies from academics and nonprofit organizations indicate that the crisis has been experienced unevenly, with African American and Hispanic households disproportionately affected by the economic downturn. In an effort to understand investors’ and non-investors’ responses to pandemic-related market volatility, researchers at the FINRA Foundation and NORC collaborated on fielding a survey to nearly 2,000 households to look for changes in investor attitudes, risk tolerance and investing behaviors.

“Our research presents investor advocates, policymakers and the financial services industry with valuable insights about the behaviors, emotions and market outlook of investors and non-investors during periods of market turmoil,” said Gerri Walsh, President of the FINRA Investor Education Foundation. “Sharp movements up or down in the stock market can challenge even the most seasoned investors, but as we analyzed the impact of pandemic-related market volatility, we saw that investor attitudes do not necessarily influence investing behaviors. We also saw signs of resilience and optimism, but these were coupled with troubling deficits in investment knowledge and a disconnect between investors’ perceived and actual risk tolerance.”

The study identified non-investors, retirement-only investors and taxable account investors. Researchers found widespread awareness of stock market volatility among investors and non-investors, but respondents reported making few transactions as the market disruption unfolded. Further, while four in 10 respondents reported a decrease in their willingness to take financial risk as a result of the market volatility, a comparison of their risk tolerance assessed before and after the pandemic started showed very little change. This finding suggests that while respondents may believe their willingness to take risk decreased since the market volatility in early 2020, little changed in their objective risk tolerance.

Other survey findings showed low levels of confidence across demographic groups that U.S. financial markets are fair to the average investor, as well as increased interest in investing among many households with taxable investment accounts, adults under the age of 30, higher income households, and Asian American, African American, and Hispanic/Latino households. Notably, among households with taxable accounts, 22 percent of white investors indicated increased interest in investing, compared to 45 percent of African American and 41 percent of Hispanic/Latino taxable account investors.

“Although African American and Hispanic Latino respondents were more pessimistic about market recovery in general, there was increased interest in investing during this period of market volatility among African American and Hispanic Latino investors,” said Angela Fontes, director of the Behavioral and Economic Analysis and Decision-Making (BEAD) team at NORC at the University of Chicago. “Investors with a taxable account and high investment knowledge were particularly more interested in investing, despite recent market volatility.”

The survey used in the study included a series of investing knowledge questions. African American and Hispanic/Latino investors scored significantly lower than white investors on this five-question quiz, though the lower levels of investment knowledge are likely linked to a number of contextual factors, including limited assets to invest.

“A lack of investment knowledge may result in suboptimal investment decisions, especially during times of market disruptions,” Walsh noted. “As new investors enter the stock market, it will be critical that they take advantage of unbiased educational resources, such as those available at, to help them understand risks and manage market volatility.”

The two research briefs, The Impact of Pandemic-Related Volatility on Stock Market Expectations and Participation and African American and Hispanic/Latino Responses to Pandemic-Related Volatility in the Stock Market, are the first to be published as part of the FINRA Foundation–NORC series, Consumer Insights: Money & Investing.

About NORC at the University of Chicago
NORC at the University of Chicago is an objective, non-partisan research institution that delivers reliable data and rigorous analysis to guide critical programmatic, business, and policy decisions. Since 1941, NORC has conducted groundbreaking studies, created and applied innovative methods and tools, and advanced principles of scientific integrity and collaboration. Today, government, corporate, and nonprofit clients around the world partner with NORC to transform increasingly complex information into useful knowledge.

About the FINRA Investor Education Foundation
The FINRA Investor Education Foundation supports innovative research and educational projects that give underserved Americans the knowledge, skills and tools to make sound financial decisions throughout life. For more information about FINRA Foundation initiatives, visit

FINRA is a not-for-profit organization dedicated to investor protection and market integrity. It regulates one critical part of the securities industry—brokerage firms doing business with the public in the United States. FINRA, overseen by the SEC, writes rules, examines for and enforces compliance with FINRA rules and federal securities laws, registers broker-dealer personnel and offers them education and training, and informs the investing public. In addition, FINRA provides surveillance and other regulatory services for equities and options markets, as well as trade reporting and other industry utilities. FINRA also administers a dispute resolution forum for investors and brokerage firms and their registered employees. For more information, visit