Most millennials were advancing from college when the last economic crisis hit the stock market. But now, the group is older, wiser, and more experienced in digital trading platforms. They have since flooded the stock market, which has seen an increase in popularity amongst this generation in the last few years. Today, millennials dominate the industry, cashing in on stocks while Boomers run in fear.
The influence of technology has also contributed. For instance, the use of trading platforms with no brokerage rates remains most popular among millennials. One of them is the Robinhood app that has experienced a surge in users over the last few years. The app uses data generated from the Robinhood API to track the user’s stock over time.
Many online trading platforms are experiencing a surge of new users even during the ongoing global coronavirus pandemic. Many being millennials who currently appear to be concentrating on investing in the stock market. The introduction of digital trading provides an excellent platform for more users to access stocks readily. The rise in the unemployment rate globally, along with many professionals working from home, is another factor that sees young people turning to stock markets.
Presence of Millennials in The Stock Market
Previously, investing was considered a thing for the older generation, but millennials are taking over. They are becoming more confident in trading stocks, and many are making a small fortune out of it. Newfound traders are using it as a secure way of building financial security and preventing debts. Getting into the stock trading business is now straightforward, with resources to get started readily available. These are among the factors that drive millennials into the stock market.
Studies show that young investors are thriving in trading stocks, while other age groups are wary about investing. The 2008-09 financial crisis saw different companies being hit by the drastic fall of the stock market. At this time, millennials were in their 20s and were unlikely to have been trading. Older traders would have experienced the worst of it, causing them to be a bit hesitant to invest during the current economic uncertainty.
The presence of millennials in stocks has, to a full extent, shifted the way the market behaves. That is, this group is ready to take risks while capitalizing on opportunities. Many companies have seen shares being bought where they otherwise might not have. For instance, even after Hertz announced its bankruptcy, its price increased, and buyers are readily available.
Crypto Trading – The Next Big Thing for Millennials
Though the stock market has become the thing for millennials, there is no guarantee that the market will remain the same. If history has taught us anything, its that irrational markets always come back down to earth eventually. Once the stock market goes south, the young may be prompted to think fast and make some drastic changes. Over the last decades, the stock market has experienced multiple economic downturns, seeing both traders and companies losing a lot of capital. When this happens, stocks fall, and the prices often take months or even years to recover. However, when the stock market becomes too risky to contemplate, millennials may turn to crypto trading for profit.
Since the introduction of cryptocurrency, many investors have made staggering profits, and millennials are no exception. Bitcoin prices have seen significant surges over the years, increasing hundreds of percent in a few weeks. Here, millennials have an opportunity to capitalize and make some serious profits. The late 2017 bull market made the Bitcoin and cryptocurrency market the best performing market for investors. The bitcoin price, which previously traded below $1,000 per bitcoin, surged to nearly $20,000 on all the major cryptocurrency exchanges.
Crypto investors at the time made hundreds of thousands of dollars, and crypto trading became the talk of the day. In 2018 however, the price dropped significantly despite new users joining the market. Over the last 12 months, the price of bitcoin has begun to grow once again, along with the broader cryptocurrency market. Many cryptocurrency traders and investors anticipate for the next bull run on the horizon.
A Repeat of The 2017 Bull Market
The crypto trading trend suggests that a bull market like that in 2017 and previous years could happen again. Exchanges are reporting an uptick in new users and deposits. However, today’s cryptocurrency landscape looks different from 2017. Many of the currencies born in the ICO-mania are now abandoned and worth next to nothing, leaving behind more robust projects which show much more promise.
Different studies suggest that the cryptocurrency market will boom once again and yield yet more profits for those invested, as Bitcoin approaches the start of a new market cycle. Millennials want profitable investments, and they are not risk-averse, so they will likely flood the Crypto market and become the dominant trading group.
But the transformation of the cryptocurrency market, technology, and policies of bitcoin trading over time have revised bitcoin exchange rates. The long-awaited bull market is likely to be different compared to the 2017 surge. Investors, however, remain determined to gain significant profits from the anticipated rush. As such, millennials may turn to Crypto trading to continue their profitable pattern once the stock market collapses.
Despite the criticism that the cryptocurrency market receives, it could be an alternative for Millenials if and when stock markets fall. When things go south for the stock market, the recovery could take years, and millennials will move on to the next big thing.
This article does not necessarily reflect the opinions of the editors or management of EconoTime