Who is trading online? A dramatic demographic shift has hit the world of trading. Let go of your stereotypes as we enlighten you to who is really trading these days.
The development of apps has opened up trading to a younger generation, especially for day trading. And there are more and more women trading each day. Surprisingly, young people and women appear to be drawn in by the greater access of cryptocurrency. But why is this all changing?
Not your stereotypical trader
Traders are getting younger! BrokerNotes found 65% of all online traders in the UK fall into the 18-34 year old age category and this figure is increasing year on year. Millennials make up 58% of all online traders. The shift towards a younger demographic is clear! No wonder brokers have stopped targeting over 45 year olds – they only make around 15% of all traders.
With women becoming better represented in industry their proportion has increased to 1 in 7 of all traders – this equates to 2.7 million female traders worldwide. Most of this increase is from an increased popularity in online trading by women in Asia. Cryptocurrencies are the most popular category for women to trade making up around 60% of trades.
Also, traders don’t seem to live in as much luxury as we think (the Lamborghinis are misleading) with most traders at a household income of less than £35k per year. Not only are traders living more modestly but a whopping 95% of traders don’t live in a financial city at all. This is just one indication that trading is becoming a lot more mainstream.
What is driving change?
It is now much easier to start trading. Today, anyone can download an app and start trading by copying experienced traders on social media to make a profit. Social trading is an area which is gaining a lot of traction and perfectly suits younger traders. Communities of traders share information and interpret signals as a collective to help each other.
Cryptocurrency has gained a lot of media attention over the past few years with the introduction of new currencies such as Bitcoin and Ethereum peaking the interest of younger audiences. A huge 75% of 18-34 year old traders trade crypto!
The increased ease of access of smartphones has definitely driven this shift in trader demographics. While 15 years ago you could only access the most basic apps, now you can have your portfolio easy to access in your pocket. Gone are the days where you sit at a desktop computer to carry out your trades, now thanks to simple user interfaces and lightning network speeds you can perform transactions from wherever you want. And we all know how much the younger generation love anything convenient! New technology means digital natives can start trading with greater ease with mobile trading now making up 60% of all transactions.
A shift towards younger and less experienced traders has rippling effects across the trading industry. The amount of demo accounts on broker platforms has widely increased giving younger traders a chance to get to grips with trading before they actually invest. Not only this, but there is now also a lot more awareness of the risks and better safeguarding to protect beginners. With more regulations the industry is getting more respect by the public, trading is no longer associated with scams but instead is now seen as a positive and dare I say sensible activity.
The average trader is not quite what you think. There are now more younger, female and crypto traders than ever before. If you want to practice trading before you invest then download BullBear.
*We thank BrokerNotes for the statistics used in this article from their 2018 survey.