Özet:

Abstract Investors’ attitudes were severely altered by the Covid-19 crisis, which had an intolerable effect on volatile returns in Nigerian stock market and other stock markets worldwide. Psychological trauma was experienced by stock investors due to the inability to foresee returns following the worldwide shock of Covid-19 and the subsequent drop in stock investments brought on by the unpredictability of macroeconomic behavior. This study analyzed the link effect of investor psyche on stock returns in Nigeria between March 2019 and December 2022. For this research, Sentiment Index (SMI) model was employed for the connection between investors psyche and returns on the Nigerian stock market. It was found that, investors psyche during Covid-19 pandemic negatively affected stock returns, resulting from negative concerns about their survival and financial security than the stock market, thus triggered sharp decline in stock investment. Thus, study concluded that Covid-19 outbreak impacted stock returns negatively. The research recommends that the Nigerian stock exchange commission should increase disclosure of market information, which is related to the magnitude and potentials of stock returns and degree of volatility at all times. The concerned volatility and potentials during the Covid-19 era were also influential to enhance investors’ confidence.

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