Millennials topped the on-platform share-trading statistics, particularly in the Asia-Pacific region, according to new data released by an influential US digital stock-broker last week.
The DriveWealth analysis of trader behaviour during the first half of 2022 found APAC-based Millennials represented more than 90 per cent of stocks bought or sold via associated direct share platforms.
DriveWealth acts as the back-end US share-trading engine for more than 100 platforms across the world including Australasian players Sharesies, Hatch and Stake.
But while Millennial-age investors were the most active in all regions, the cohort “took the market by storm in APAC, commanding 94% of trades, a 22% increase in total trades placed since [the second half of 2021] and the highest percentage increase worldwide”, the report says.
“[APAC] Millennials also represented the largest group of first-time investors, responsible for 49% of opened accounts,” DriveWealth says. “This percentage was the only generation to increase over the past six months, suggesting that younger investors will continue to take on the markets at a higher rate than older investors.”
The generation now aged from late 20s to about 40 based in APAC also continued to trade aggressively during the 2022 market volatility with the top two bets plonked on “triple-leveraged ETFs” that track a Nasdaq 100 index.
“Known as a high-risk sector, this suggests Millennials in this region may be motivated by riskier investments with the potential for high returns,” the DriveWealth report says.
Apple and Tesla also featured in the top-five APAC-traded stocks along with a group of other electric vehicle challengers.
“For now, the data suggests that investors are following the headlines and actively trading in the short-term with the hope of potential gains long-term,” the study says.
Almost all of the trades on DriveWealth, which counts underlying clients of more than 12 million, were through ‘fractional’ shares – where investors own a small piece of an individual share in a process administered on the platform.
During the first half of this year 96 per cent of DriveWealth trading was in fractional shares compared to 92 per cent over the last six months of 2020.
Gayathri Rajan, DriveWealth chief product officer, said in a release: “Despite market uncertainty, people – especially younger investors – are still investing in the brands they love using digital tools that are making markets accessible and affordable for them.”