Before anyone buys a mutual fund or trades a stock, they have easy access to a wealth of information about the investment. Corporate earnings reports are posted on company websites, and many financial service companies provide basic analysis statements that explain potential risks. Most investors, however, rely on news reports when making financial decisions.
In a 2020 survey conducted by The Harris Poll, 72 percent of American investors said that current events and news influenced their decisions. And stories about international conflict or public health scares may even be more influential than financial news — in the survey, current events outranked both Federal Reserve announcements (66 percent) and corporate earnings reports (61 percent). These results support past studies that find people are more apt to purchase stocks from companies making headlines.
