On 30 November 2022, the International Organisation of Securities Commissions published a report, ‘Investor behaviour and investor education in times of turmoil: Recommended framework for regulators based on lessons learned from the COVID- 19 pandemic’. The final report highlights the research insights and experiences IOSCO members gained during the COVID-19 pandemic. It explores changes in investor behaviour during the pandemic and regulators’ responses worldwide. In particular, the final report provides information on the measures regulators and investor educators took to increase retail investor protection during periods of extreme market volatility and economic turmoil.
The final report shows that the COVID-19 pandemic introduced new challenges and exacerbated some existing issues. It highlights that the COVID-19 period featured:
- high levels of market volatility;
- an upward trend in self-directed investing;
- an increase in gamification of investing and growing investor reliance on social media for advice; and
- a huge surge in fraud scams in a context of increased retail (and young and democratically diverse) investor participation.
However, the final report also finds that the COVID-19 pandemic did not hinder investor education activities to support investor protection throughout the pandemic. In fact, many regulators continued, expanded and/or adapted their investor education activities to support investor protection throughout the pandemic. Furthermore, the final report finds that it is now easier to participate in the financial market than ever before and retail investors continue trading in riskier investments, while regulators report a higher volume of investor claims and complaints.