Spike of Gen Z traders in the last year
It looks like the online trading bug has bitten Gen Z as research has revealed that more young people have begun exploring low-cost investment brokerages while also placing the onus on themselves in terms of learning how to trade. The upsurge in young people looking to this alternative means of procuring an income can in some ways be attributed to the global health crises of the last year and a half. In fact, in the UK alone, sixteen percent of Britons between the ages of 18 and 24 opted to explore trading options for the first time. Prior to the lockdown this figure sat at ten percent. While the general assumption might be job security or the lack thereof, as it turns out, spare time was one of the main motivating factors behind young people making the move into the equity markets. With more time on their hands, Gen Z traders were able to better equip themselves with the skill sets required to navigate the financial instruments that make up the world of online trading.
A trend cast in stone?
It appears that the upsurge of Gen Z traders is not just a passing phase, but more likely a trend that’s here to stay, and while commodities and spread betting have proven popular, most young traders have cited learning to trade in popular forex couples like EUR/USD, USD/JPY and GBP/USD as their preferred options. It’s not hard to see why either; trading in currency pairs means that as a trader one stands to become empowered by the knowledge that comes with the vocation. Online traders who make a success of trading in currency pairs gobble up all forms of financial news while always monitoring the politics of the countries to which the currencies are affiliated. This makes the act of trading not just a potentially lucrative one, but also one of incredible intrigue. The extent to which trading has taken hold with the Gen Z crowd is such, that a recent study revealed that almost half of investors have declared their intention to regulate their spending habits after lockdown in order to go on trading. But outside of currencies, what is the Gen Z crowd trading in?
What else is Gen Z investing in?
In an age where social media has become one of the main conduits of communication, it’s not hard to see why loads of Gen Z traders are deemed tech savvy, often relying on Reddit forums, You Tube Videos, online influencers and the sharing of memes about popular penny stocks like AMC and GameStop. When it comes to other stocks and equities, technology and established industry stocks seem to be the options of choice. Apple, Tesla, Disney, Netflix etc.; these are some of the companies that Gen Z traders are gravitating towards. In the US, traders and investors are mainly backing cars, technology and healthcare. In fact the top 50 investment options for young US traders includes the likes of the aforementioned Apple, FitBit, GoPro, Ford, Starbucks, Uber, Pfizer and Moderna. On the other side of the pond, young UK traders have shown a greater propensity towards travel and technology companies with Airbnb, Zoom, Nokia and Honda forming part of the top ten organisations getting the most investment attention from young traders and investors. If one thing’s for sure, it looks like Gen Z could play a large role in the future shaping of the stock market.