- Fear of loss (43%) and optimism (31%) are the top emotional drivers steering retail investor decisions
- Investment losses spark caution but also resilience among retail investors
- 86% of investors admit personal experiences and emotions influence their investment choices
London, 8 May 2025 – Fear of loss and optimism are the top two emotional triggers affecting retail investors’ investment decisions, according to data from the latest Retail Investor Beat from trading and investment platform eToro.
In the study of 10,000 retail investors across 12 countries, 43% identified fear of losing money as the emotional driver that most significantly impacts their investment decisions, while 31% cited optimism as the main factor. Excitement and impatience were both chosen by 18% of retail investors, followed by overconfidence (15%), greed (14%), panic (12%) and fear of missing out (12%).
Commenting on the data, eToro’s Global Market Strategist Lale Akoner, said: “It’s interesting that two polar opposite emotions – fear of loss and optimism – top the drivers that retail investors cite as most impacting their investment decisions. Fear of losing out (FOLO) significantly outweighs fear of missing out (FOMO), contrary to outdated beliefs that ‘reckless’ and ‘speculative’ retail investors chase unrealistic returns. This cautious behaviour is likely heightened by the current uncertainty, which makes weighing risks and opportunities even more essential.”
The data also highlights geographical differences (Table 1). Fear of loss is especially strong in Italy (61%), while British investors are particularly influenced by optimism (36%). Spain exhibits the highest proportion of investors driven by overconfidence (23%), Australian investors are more likely to be influenced by excitement (23%), and impatience is most cited in Germany (25%). France leads in the proportion of investors motivated by greed (41%) —whilst the global average stands at just 14%.
Table 1: Emotional drivers impacting investment decisions
| UK | US | Germany | Australia | France | Spain | Italy | Netherlands | |
| Fear of loss | 37% | 43% | 41% | 37% | 42% | 46% | 61% | 35% |
| Optimism | 36% | 35% | 34% | 35% | 24% | 31% | 20% | 29% |
| Excitement | 20% | 22% | 16% | 23% | 11% | 14% | 12% | 17% |
| Impatience | 13% | 17% | 25% | 17% | 14% | 21% | 18% | 21% |
| Overconfidence | 15% | 15% | 9% | 15% | 13% | 23% | 17% | 16% |
| Greed | 10% | 12% | 11% | 13% | 41% | 11% | 8% | 11% |
| Panic | 12% | 14% | 12% | 13% | 9% | 10% | 9% | 10% |
| Fear of Missing Out | 13% | 14% | 6% | 19% | 5% | 15% | 7% | 11% |
A decline in the value of their investments brings caution and resilience
The study also found that retail investors become more reflective when they experience losses on their investments. 51% say seeing the value of their investments decline made them more cautious, almost one in five (18%) believe it made them more resilient as an investor, and 16% think it had little or no impact on them. A further 18% say losing money on their investments made them less confident.
Whilst retail investors become more cautious when the value of their investments decline, the data shows that they adhere to long-term strategies to navigate market volatility. The study reveals that nearly half of the respondents (48%) stay the course and maintain their existing investment strategy during volatile times, while 23% opt to rebalance their portfolios. 12% see market volatility as an opportunity to buy more investments, and only a small fraction (9%) react by selling off their investments.
Lale Akoner added: “Experiencing losses often triggers a natural psychological response, prompting investors to protect their remaining capital. However, these setbacks also build resilience, leading to greater confidence and perseverance in navigating market fluctuations. Historical data shows that the S&P 500 has recovered from over 25 declines of 10% or more since 1928, achieving an average annual return of around 10%. Retail investors’ commitment to long-term strategies suggests they recognise that short-term losses are a part of the journey toward achieving long-term financial goals.”
Differences acknowledging emotional impact
When asked about the impact of personal experiences and emotions on their investment decisions, 86% of retail investors acknowledge that these factors influence their choices, while only 11% believe they have no impact at all.
The data shows a significant divergence when looking at retail investors from different generations and countries. Millennials and Gen Z are the most likely to acknowledge this influence (90%), compared to just 81% of boomers. By countries, Polish and Italian investors rank the highest at 92% and 91% respectively, and Dutch (81%) and Danish (79%) the lowest.
Lale Akoner commented: “As human beings, our decisions, behaviors, and perceptions are shaped by past experiences and emotional states, often subconsciously. This influence extends to all areas of life, including financial and investment choices – even for those who believe it doesn’t. Younger investors are more likely to acknowledge this impact, probably due to greater exposure to behavioral finance concepts and changing societal attitudes toward self-awareness.”
ENDS
Notes to editors
About this report
The latest Retail Investor Beat was based on a survey of 10,000 retail investors across 12 countries and 3 continents. The following countries had 1,000 respondents: UK, US, Germany, France, Australia, Italy and Spain. The following countries had 600 respondents: Netherlands, Denmark, Poland, Romania, and the Czech Republic.
The survey was conducted from 18 February – 4 March 2025 and carried out by research company Opinium. Retail investors were defined as self-directed or advised and had to hold at least one investment product including shares, bonds, funds, investment ISAs or equivalent. They did not need to be eToro users.
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