Retail traders are fueling the rise of online investing worldwide, with investors from North America, Asia and Oceania and Europe behind this rapid increase.
Latin America, the Middle East and Africa remind behind these top markets for investing, but these regions are participating in online investments and trading much more than in years past. Investing has moved beyond the traditional scope of brokers and wealth management in recent years and into the hands of everyday retail investors worldwide.
These investors engage in online investing and e-trading with financial assets, including stocks, mutual funds, futures, options, cryptocurrencies, and fractional shares. They are seeking new ways to invest and new platforms to support their financial goals.
The popularity of online investing quickly rises worldwide and is driven by easy access to trading platforms and investment information.
And this growth shows no sign of stopping anytime soon, with the number of people using trading apps soaring from 35.6 million in 2017 to over 150 million in 2021, and this emerging investor class fueled revenues for trading platforms from $3.8 billion to $10.9 billion in over this same period (Business of Apps).
Understanding the Top Global Trends in Online Investing
Today’s global retail investors can invest in assets with no more than a minimal balance, an internet connection and a digital trading platform. Involvement in trading and investing varies widely by region, with North America and Asia as the hottest markets for online trading, with Europe not far behind.
South America, the Middle East and Africa are coming into their own for digital financial services, and these regions’ top local markets are beginning to participate in investing and trading online.
North America
According to Pew’s research, more than half of US households invested in the stock market directly or indirectly through retirement accounts (Fortune Business Insights). Although online investing was already popular in North America, investments from ordinary retail investors picked up pace during the pandemic, with 39% of Americans surveyed reporting investing in the past year (Finder).
How did retail investment in North America change during and post-pandemic?
- Over six million Americans downloaded a trading app in January 2021
- 39% of Canadians currently own stocks. And over one-third (34%) bought shares in just the last year (Finder’s Global Investing Adoption Survey)
- Ten million US investors opened a new brokerage account in 2020
- Around 12.3 million Canadian adults report using a stock trading app, with over half (53%) of millennials investing using a mobile service (Finder)
- 80% of respondents from Mexico wanted to invest early would help them safeguard their future, but 60% said they do not have enough money to start investing (The Dialogue).
- One recent survey found that just 13% of Mexicans were invested in shares, although 27% plan to invest in the next year (Finder).
Latin America
There is growing enthusiasm for investing and online trading in South America, but on a much smaller scale than in North America. This is due to more limited financial digitalization and technological access, fewer financial resources and lower regional financial literacy.
According to a survey by Americas Market Intelligence and MasterCard, 80% of the respondents from Brazil knew that investing early would help them safeguard their future, but 60% said they do not have the resources to begin (The Dialogue). While high net worth investors have already started diversifying their investments and investing in North American markets, most South American consumers will need more resources and access before getting involved with trading (Morgan Stanley).
Additionally, the region was hit hard by the pandemic, drying up limited resources for investment, as 30% of investors in the region reported a severe setback to their financial security due to Covid (Natixis Investment Managers). That said, the COVID did bring some positive shifts to the region by accelerating the consumer and business adoption of digital services and financial products across all socioeconomic groups (The Dialogue).