Investors turn to digital solutions

By Jayson Forrest - Managing Editor  - IMAP Perspectives

Irene Guiamatsia, Head of Research at Investment Trends
Irene Guiamatsia - Investment Trends

Investors turn to digital solutions

A record number of Australian investors are turning to online equities and ETFs, as they embrace new digital investing solutions.

Too many times we’ve heard stories of investors getting caught up in the ‘fear of missing out’, making rash, short-sighted investing decisions. But our research highlights that investors are hungry for knowledge, resources and tools to help them build long-term wealth.”

Irene Guiamatsia

Young Australians are increasingly embracing investing, with one in six first-time investors under the age of 25

Irene Guiamatsia

The spectacular recovery witnessed by U.S. stocks in the second half of 2020, captured the attention of a global audience, prompting many Australians to consider investing beyond local equities

Irene Guiamatsia

Growing number of active retail online investors

At the end of 2020, the number of active retail online investors in Australia reached a new high of 1.25 million, highlighting a trend that has seen the retail investing market continue to grow, as Australians responded to changing macro conditions and embraced new digital investing solutions.

According to the latest findings from Investment Trends 2020 2H Online Investing Report, over the last 12 months, 435,000 Australians began trading listed investments for the first time, which coincided with the COVID-19 lockdown.

“Young Australians are increasingly embracing investing, with one in six first-time investors under the age of 25,” said Irene Guiamatsia, Head of Research at Investment Trends.

“COVID-induced market volatility and a low interest rate environment were important prompts for first-time investors entering the market, but even more prominent was the desire to learn a new skill, highlighting how many Australians chose to spend their free time during the lockdowns.”

The record growth in investor numbers was also driven by strong interest for international stocks, with the number of active international share traders in Australia doubling from 54,000 to 109,000 in the 12 months to December 2020.

“The spectacular recovery witnessed by U.S. stocks in the second half of 2020, captured the attention of a global audience, prompting many Australians to consider investing beyond local equities. A greater choice of investment platforms has been a key driver for the uptake, with recent new entrants giving investors more choice than ever before,” said Guiamatsia.

Besides lower fees, investors entering the market wanted education about strategies for the current environment (27 per cent) and daily newsletters (20 per cent).

“Too many times we’ve heard stories of investors getting caught up in the ‘fear of missing out’, making rash, short-sighted investing decisions. But our research highlights that investors are hungry for knowledge, resources and tools to help them build long-term wealth.

“Investment platforms that effectively support their clients on their investment journey will stand out,” said Guiamatsia.

The Investment Trends 2020 2H Australia Online Investing Report examined the attitudes, needs and product usage of active online investors. The findings were based on a survey of 18,731 investors and traders.

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Irene Guiamatsia is Head of Research at Investment Trends

 

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