Revealed! The three most popular assets for beginner investors in 2021

Beginner investors accounted for a large percentage of trading activity in 2021. So what are the most popular assets among newbies? Karl Talbot takes a look.

The content of this article was relevant at the time of publishing. Circumstances change continuously and caution should therefore be exercised when relying upon any content contained within this article.

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Beginner investors piled in to invest their wealth last year, and new research reveals that newbies have as much confidence as ever in the stock market.

So what were the most popular assets among beginner investors in 2021? And what else can we learn from the research? Let’s take a look.

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What were the most popular assets for beginner investors?

According to BrokerChooser, beginner investors ‘flooded’ the markets last year and are ‘here to stay’. In light of this, here are the most popular assets among beginner investors in 2021 (so far):

1. Stocks

A stock represents a fractional claim to ownership of a company. In other words, if you hold a stock in a company, then you get to stake a claim on its assets.

2. Exchange-traded funds (ETFs)

An ETF tracks the price of an index, sector or commodity. ETFs are sold on an exchange, such as the stock market, and are often favoured by passive investors.

3. Cryptocurrency

Cryptocurrency refers to digital, decentralised currency, with ‘Bitcoin’ being the best-known. While the concept of cryptocurrency has become mainstream in recent years, the sector remains widely unregulated in the UK.

The content in this article is provided for information purposes only. It is not intended to be, neither does it constitute, any form of investment advice. Bitcoin and other cryptocurrencies are highly speculative and volatile assets, which carry several risks, including the total loss of any monies invested. Readers are responsible for carrying out their own due diligence and for obtaining professional advice before making any investment decisions.

What does the data reveal about the number of beginner investors?

According to BrokerChooser’s data, there are more beginner investors in the US than in Europe. That being said, there is roughly the same number of retail traders in Europe as there is across the pond.

One statistic of note is that day trading is a more common pursuit in the US than in Europe. This suggests that Americans have a riskier attitude to investing than their European counterparts. That’s because day trading is favoured by those chasing high returns in the short term. While it may seem like a decent approach, day trading is essentially a zero-sum game, and it can lead to substantial losses compared to a longer-term investing horizon.

Interestingly, 9% of those included in the data say they are interested in cryptocurrencies. This compares to less than 5% last year, revealing that digital currency is a growing sector of interest among those new to investing.


What else can we learn from the data?

Aside from beginner investors, the analysis reveals that investing remains a male-dominated activity. That’s because male investors outnumbered female users in every country in the world. In 2021, male investors accounted for 76% of traders, while females made up 24%. 

With regards to age groups, 39% of BrokerChooser traders are aged 25-34. Just 5% of traders are aged over 65. Interestingly, the number of investors using desktop computers and mobile devices was almost an even split, with 49% using fixed computers and 51% preferring mobile devices.

How did the report suggest stock markets will perform in 2022?

The report suggests that the performance of global stock markets may be impacted by rising interest rates, as well as any new or existing Covid-19 variants coming into play.

The report also suggests that rising inflation, higher energy prices, and the ‘ballooning’ Chinese housing bubble may be responsible for impacting global stock markets next year.

Krisztian Gatonyi, senior broker expert at BrokerChooser, suggests that interest rates may also be an issue next year. He explains, “As a result of the ongoing inflationary pressures, rising interest rates can be expected in 2022.”

Gatonyi also highlights the ongoing impact of Covid-19, stating, “The effect of the omicron Covid-19 variant could cause high volatility on the financial markets next year.”

While both of these events may cause concern among cautious investors, the report outlines that uncertain markets can provide ‘trading opportunities’. That’s because in volatile markets big swings can provide investors with more opportunities to make big gains. That said, volatile markets also make it easier to lose money!

As with any investing, it’s important to understand that stock markets can fall as well as rise. If you’re new to investing and want to learn more, then take a look at our investing basics.

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