How Technology Encouraged Younger Adults to Invest During the Pandemic
Since the outbreak of Covid-19 earlier this year, schools and businesses have been forced to shut down. This has negatively impacted the U.S stock market. Moreover, home-schooling has become the only option for most parents. Because of the lockdown, most people had to stay indoors to mitigate the spread of the virus. As a result, they had enough time to reconfigure their budgets. Normally, only seasoned investors decide to invest when the market is at its lowest. However, this time around, even younger adults decided to invest in retail trading.
A recent analysis reveals that trading volumes increased by 27% within the first six months. Even though the pandemic affected the economy, investors saw an opportunity. According to Wilson Muscadin, younger adults can now differentiate between the stock market and economy. Unfortunately, the pandemic has led to increased unemployment and business closures.
To make investing easier, younger adults can now access the necessary tools and at a reasonable cost. It is why more people are thinking about investing. Moreover, technology has encouraged millennials to invest, even if it is their first time.
Technology Encourages People to Invest
Technology is one of the reasons why even newbies are investing. According to a recent survey, investment apps gave people the idea to start investing. They rely on free trading apps, a financial planner, and traditional brokerage. Between March and April, approximately 780,000 individuals opened new trading accounts. Robinhood, a renowned financial app, opened new accounts for up to 3 million users. Thanks to technology, investing in the stock market is easier. An individual only needs internet, a computer or a smartphone, and funds. Investors should focus on making returns instead of making quick cash.
It Is Important To Have a Passive Investing Strategy
Without a strategy, making money through investments can be difficult. Between buy-and-hold strategy and active investing, the latter is riskier and ideal for seasoned investors. Unfortunately, active management doesn't have high returns and is expensive. On the other hand, a passive investing strategy is suitable for individuals looking to invest their money for long-term goals such as retirement. Passive investment strategy uses investment instruments and is cost-effective.
The above shows how technology has helped individuals invest and make money during the Covid-19 pandemic.
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