Investment Trends Among Generations
It is no secret that Millennials and Gen Zers have investment philosophies that differ from Baby Boomers and Gen X. However, the launch of spot bitcoin exchange-traded funds (ETFs) earlier this year, along with spot ether ETFs, seems to have helped bridge that gap.
Thursday's release of the annual Schwab Asset Management ETF study zeroes in on what investors are interested in over the next 12 months, and crypto is top of mind.
"Millennial ETF investors have the strongest appetites for ETFs and are most interested in more personalized ways to invest," Schwab wrote in the release. "They have higher levels of interest in direct indexing and are more likely than other generations to invest in direct indexing in the next year."
Millennial Interest in ETFs
Millennials report higher levels of interest in several ETF types and asset classes. According to the Schwab survey, 62% of Millennials plan to invest in cryptocurrency ETFs over the next year—the highest percentage across asset classes. For Gen X, the figure was 44%, while just 15% for Boomers.
"Millennials report significantly higher levels of confidence," the release stated. "They are more likely to think they have the skills to outperform the markets and more likely to say they prefer to take on more risk for higher returns."
Growing Bullishness on ETFs
More broadly speaking, ETF investors have grown more bullish toward several sectors over the last year, and more of them plan to invest in cryptocurrencies via ETFs.
Schwab mentioned that ETFs make up 27% of ETF investor portfolios today, while 65% plan to increase ETF investments in the next year. A separate study from the Alternative Investment Management Association (AIMA) noted that 47% of traditional hedge funds now have exposure to digital assets, with 43% seeing increased interest in crypto from institutional clients.
Since launching in January, spot bitcoin ETFs have generated a cumulative trading volume of $426 billion, according to The Block's data dashboard. BlackRock's IBIT dominates the market with nearly two-thirds share. Many industry experts have termed it the most successful ETF launch ever. "Investment advisors are adopting bitcoin ETFs faster than any new ETF in history," Bitwise Invest CIO Matt Hougan remarked last month.
Survey Details
Schwab surveyed 2,200 individual investors aged 25 to 75 with at least $25,000 in investable assets. Among them, 1,000 had bought or sold ETFs in the past two years, while 1,000 had either never bought or sold ETFs or had not done so within the past two years. The respondents included 200 investors who started investing in 2020 or later.
The study was conducted from July 2 to July 20, prior to the debut of the Ethereum ETFs.
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