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Proprietary Data Insights Top Stock Searches This Month
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We’ll get to the reasons and possible remedies in a minute. But first, more on the scale of the problem that, as we reflect, might not be that big of a problem after all. It started in 2019. Interest in investing increased, thanks in part to the expansion of fee-free trading. For example, when Charles Schwab dropped commission charges in October 2019, it added 142,000 new accounts – a 31% increase from the previous month. That was nothing compared to what happened when the government told us to stay at home, and meme stocks and cryptocurrency went wild. In 2020, individuals opened a record of more than 10 million new brokerage accounts. Apex Clearing, which facilitates trades and provides other services to brokerages, helped open almost 6 million accounts in 2020, a 137% increase from 2019. One million of those accounts went to Gen Z investors. FINRA data backs this up. Sixty-two percent of new investors in 2020 were 44 years old or younger. Source: FINRA They were also more racially/ethnically and economically diverse. So where did they go? Why? And does it matter? Scroll with us for some perspective. |
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$2 Coin could explode in Crypto’s 3rd Shock Wave |
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Most people are panicking right now… but multi-millionaire crypto analyst Joe Shew is convinced this is a rare chance for regular people to cash in on a small $2 coin set to soar as soon as this month. After picking Bitcoin at $369… and Ethereum at $7… this is a must watch broadcast Click here to see details on the move he’s telling everyone to make. |
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Investing |
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Why Millennials Are Selling Their Investments |
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Key Takeaways:
Source: Ally The financial media loves to get hysterical over this type of stuff. At The Juice, we put things in perspective and look for a silver lining. Yes, according to data from Ally, 49% of millennials and 21% of Gen Z sold some or all of their investments so far this year. But the reasons are clear, if not obvious. And they make sense. More Millennial Hate? When The Juice sees data like this – and the reaction to it – we read between the lines. Just another example of fickle millennials and Gen Zers going all-in on something then bailing when things get tough or something better comes along. We think not. Inflation. The #1 reason millennials sold? To cover day-to-day expenses. Chalk this up to rising costs. Clear, obvious, expected. Losing money. Or the fear of losing money. We’ve all been there before. We get spooked out of the market because we lost money or worry we might. Perfectly rational and, actually, useful. Without this experience, you can’t truly learn the lesson of patience. When the market’s down, you buy because, as history repeatedly shows, odds are it will rebound. Cash security. Research also shows some young people entered the market without emergency funds. Suddenly, inflation hit, things got tight, and maybe they lost some money, but they still had a decent amount of cash in their investment accounts. More power to any young investors who did this, for responding to the momentary freakout, taking that cash, and creating emergency funds with it. It’s personal finance and investing 101 – you should have cash saved for life and unexpected expenses before you put money in the market. $14 margaritas. No doubt, some millennials and GenZers probably cashed out to enjoy themselves as pandemic restrictions eased. To spend their newfound nest eggs on $14 margaritas and other discretionary luxuries. Can you blame them? With everything getting more expensive as life returns to normal, it feels good to have cash at the ready to satisfy your needs and wants. It’s human nature. And it’s okay. Call it financial liberation! They’re not all gone. And they’ll be back. Maybe most important, this introduction to investing wasn’t just a gamble on meme stocks. The most popular stocks Gen Z holds prove this. They’re refreshingly diversified in a mix of speculative names, tech stocks, blue chips, and steady dividend payers. This tells us new investors caught on quickly to basic investing basic principles. (We’ll update you on which stocks Gen Z owns on Friday.) Despite the defections, many of these investors are likely still invested (and actively investing). Don’t ignore that the data says they sold “some or all” of their holdings. Folks in the “some” group might still be active. The pandemic introduced them to investing. The economy and related factors shook them out. Or maybe it was just a little profit-taking, panic selling, or both.
The Bottom Line: It was foolish to think all or even the majority of pandemic-era new investors would still be around as 2022 ushered in super-high inflation, skyrocketing interest rates, and record-high house prices alongside record rents just as life returned to normal. The people who bailed – young or otherwise – did so for obvious and generally good reasons. This introduction to investing should make the financial industry happy. More than that, it should motivate brokerages and other entities with a vested interest to find creative ways to keep people – young or otherwise – engaged in and excited about investing. In an effort to be part of the solution, we’ll launch a series next week on how this could look. But first, what about crypto? Have investors bailed on it? In tomorrow’s Juice, we’ll explore exactly how things look in the crypto market, focusing on Bitcoin. Remember Bitcoin!? |
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