Hedge Crunch FinancialNew investors younger, more diverse
The Wall Street economy is undergoing a demographic shift, with new investors trending younger and more culturally diverse than previous generations, according to a study published by the FINRA Investor Education Foundation and NORC at the University of Chicago.
The “Investing 2020: New Accounts and the People Who Opened Them” report, which surveyed 1,291 households from Oct. 26 to Nov. 13, 2020, shows that 66% of last year’s new investment portfolios were opened by individuals making their first forays into the market.
Major findings include a rise in the percentage of non-white first-time investors: Seventeen percent of new investment accounts in 2020 were opened by black clients; an additional 15 percent were opened by Hispanic/Latino clients and 10% by Asian clients.
The report also outlines the socioeconomic status of new investors. Nearly one-quarter of newcomers to the stock market earn less than $35,000 a year.
“Some of these new brokerages have offered opportunities to enter the stock market that haven’t been there before,” Angela Fontes, vice president of Behavioral and Economic Analysis and Decision-making at at NORC at the University of Chicago, told the Detroit Free Press.
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