The majority would increase their allocation to cryptocurrencies if the asset class were regulated
Saxo Markets UK, the licensed subsidiary of Saxo Bank, has conducted a research revealing that retail investor participation in financial markets will keep growing in 2022, but investors are wary of the risks ahead as markets see a correction.
The biggest concern for young investors aged 18-34 years is a cryptocurrency crash.
Nevertheless, despite these fears, 56% plan to increase their investment allocation to the digital asset class, challenging the risk on/risk off setting.
An even higher percentage (59%) would increase their allocation to cryptocurrencies if the asset class were regulated.
Inflation and a more widespread stock market bubble leading to a correction were second and third respectively in terms of biggest concerns for young investors. Just a little over one in ten (13%) were concerned about the impact of the pandemic risk on their investments.
Despite the recent stock market performance, 3 in 5 young investors still plan to increase their stock investment allocation this year. 46% believe tech stocks will perform best despite well-known shares such as Netflix losing 33% of its value, Amazon 16%, Microsoft 12% and Alphabet 10%.
WFH stocks, energy stocks and meme stocks were listed second, third and fourth respectively in terms of investment performance expectations.
Young investors continue to use social media as their primary source of information, followed by news sites and forums. Just one in ten are influenced by their peer group. When asked more specifically, Reddit, Twitter and Facebook were seen as the most important media platforms for investing in 2022. Just over one in ten (12%) suggested it was Instagram, despite the increasing use of influencers to lure retail traders.
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