Young investors plan to plough more money into cryptocurrency despite fears of a crash, new research from Saxo Markets UK has found.
More than half (56%) of 18-34 year olds plan to increase their asset allocation to the digital asset class and an even higher percentage (59%) would increase their allocation if the asset class were regulated.
Saxo Markets said inflation and a more widespread stock market bubble leading to a correction were the second and third 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.
However, despite the risks, the research found 59% of young investors plan to increase their stock investment allocation this year. Nearly half (46%) believe tech stocks will perform best despite tech titans such as Netflix, Amazon and Microsoft all dropping in value.
Saxo Markets said most young investors are drawn to investing to earn extra income followed by securing their long-term financial future. One in seven (14%) cited fun as the reason for investing.
Most continue to use social media as their leading source of information, followed by news sites and forums. Just one in ten are influenced by their peer group.
Charles White-Thomson, CEO of Saxo Markets UK, said: “One year on from the events which saw the rise of the so-called Reddit army of traders, a quieter but more sustainable cohort of younger investors is emerging which will shape the future of investing for years to come.
“Many such investors have, however, not witnessed a market crash or a major financial crisis, so it is critical that alongside their increased investment activity, they not only seek credible sources of investment information but also look to diversify their holdings to ensure that any recent gains are protected rather than wiped off.
“The mantra that markets always go up may no longer be true in 2022 so diversification and risk management will be key.”
