New investor wave driven by younger participants
Generation Z, those aged 18 to 24, account for nearly one-third of new online investors in 2024, according to Investment Trends.
The research house’s 2024 Australia First Half Online Investing Report surveyed over 13,760 participants, including 9,315 current online investors.
It discovered that participation in online investing has surged to 1.28 million active investors in the first half of 2024, up from 1.22 million in the previous six months.
This rise was predominantly driven by younger investors beginning their investment journey, the report found, particularly those in the Gen Z demographic aged 18–24 years old.
The cohort now represents nearly one-third of new online investors (31 per cent), who are often prompted to start investing online by the ability to invest small amounts of money and access investment-related education. In comparison, those aged 18–24 years old only accounted for 10 per cent of new online investors in 2019, demonstrating considerable growth.
“The latest wave of new online investors is markedly younger,” remarked Yiğit Günhan, senior analyst at Investment Trends.
“Their participation reveals a sustained interest driven by accessible investment opportunities and educational resources. This influx is reshaping the landscape, indicating a prime opportunity for online brokers to attract and retain this demographic.”
Research from the ASX’s 2023 Australian Investor Study revealed that 43 per cent of this cohort invested in Australian shares, 33 per cent in exchange-traded funds (ETFs), 31 per cent in cryptocurrency, and 25 per cent in international shares.
Moreover, Investment Trends identified that Millennials aged 25–39 years old continue to be the largest new investor group across the years, sitting at 41 per cent in 2024 compared to 43 per cent in 2019.
Accumulators aged 40–54 years old made up 20 per cent of new online investors this year, followed by pre-retirees aged 55–64 accounting for just 6 per cent.
Equities sentiment improves
In addition, the report highlighted that investor sentiment towards equities has seen a marked improvement over the past six months. Online investors can expect a 5.3 per cent return from domestic equities and 6.1 per cent return from international equities over the next year on average, according to Investment Trends.
“The renewed optimism in the market is a testament to the resilience and adaptability of online
investors. Our data shows a notable increase in confidence towards both domestic and international equities, signalling a broader readiness to embrace diverse investment opportunities,” Günhan continued.
The number of active international share investors has also risen to 152,000, accounting for 12 per cent of the active online investor population. Investors now allocate an average of 8 per cent of their investment portfolio to global equities, up from 7 per cent in the previous period.
“The rise in international online share investing is a clear indication of investors’ growing appetite for global exposure. These investors are notably more cost-sensitive, seeking not only lower fees but also transparent pricing and an easy-to-use platform.”
AUTHOR
Jasmine Siljic
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