Trading from Home: The Impact of COVID-19 on Trading Volume around the World
15 Pages Posted: 28 Sep 2020
Date Written: May 18, 2020
This paper examines the impact of COVID-19 on trading volume in stock markets around the world. We document a large spike in trading volume in 37 international equity markets. The surge in trading volume is found to be associated with the national culture and institutional environment of individual countries. In particular, investors tend to trade more heavily in societies characterized by a higher level of trust and individualism, as well as a lower level of uncertainty avoidance. Investors are also more willing to trade in wealthier nations, as well as those with stronger protection of legal rights, better governance systems, and greater gambling opportunities.
Keywords: COVID-19, trading volume, sentiment, culture, governance, gambling
JEL Classification: G13
Suggested Citation: Suggested Citation