Socioeconomic status and individual investors’ behavior during a financial crisis

Koresh Galil, Avia Spivak, Aviad Tur-Sinai

Research output: Contribution to journalArticlepeer-review


The COVID-19 pandemic triggered a financial crisis that provides a unique opportunity to examine investor behavior using an administrative dataset of individuals in Israel. The dataset includes information on withdrawals from tax-sheltered training funds, switching to less risky or riskier investment tracks, and individual socioeconomic status (SES). Our analysis reveals that during the peak of the crisis in March 2020, low-SES investors were more likely to withdraw money from their training funds despite incurring a significant tax penalty for so doing. This resulted in a double loss for poorer investors, who were hit by both the stock-market decline and the tax penalty. In contrast, higher-SES investors were less likely to liquidate their funds. Additionally, investors were found to be more likely to increase risk as SES rises and less likely to decrease risk as SES rises.

Original languageEnglish
Article number100855
JournalJournal of Behavioral and Experimental Finance
StatePublished - 1 Dec 2023


  • COVID-19
  • Financial crisis
  • Household finance
  • Household saving
  • Personal finance
  • SES
  • Socioeconomic status

ASJC Scopus subject areas

  • Finance


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