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Interested in all things Venture, FinTech, Public Markets, Personal Finance, and Sports.

12 Jul, 13 tweets

0/ The @DriveWealth team just published their 2Q Global Retail Trends report:
-1H21 trading volume surpassed FY20
-95% of trades placed had fractional component (think $SQ, @RevolutApp @monzo)
-$250 avg trade size in 2Q21
-Retail invested a record $28B in cash in June.

1/ Not a surprise given investor base but younger investors have fueled new account growth
-Under 40 was 73% in 2Q21, 77% in 1Q21
-Under 30 was 41% in 2Q21, 49% in 1Q21
-32% of people in the US said the pandemic inspired financial discipline
-33% said they will increase investing

2/ Geographically they saw a 62% increase in LatAm investor deposits, while inflows from APAC outpaced EMEA & US investors

3/ In terms of trading activity 2Q21 saw lighter activity in aggregate due to a slowdown in April & May (with that 1H21 still outpaced FY 2020).
-Trading was +22% in June

4/ The avg # of trades per account declined to pre pandemic levels to 9x
-Investors age 30-49 remained most active
-Avg trade size was $250 +15% from 2Q20 but down 12.5% from 1Q21
-Investors aged 60+ traded larger amounts (60+ $345 vs. under 60 $246)

5/ They highlight a 4Q20 survey by FINRA regarding the top 5 reasons an individual opened a new account by race.

This compares to a SIFMA pole of exchanges, trading arms, market makers about increased retail participation

6/ They also highlight HSA accounts which dovetails with a product they rolled out DriveHSA.

Most people don't realize they are triple tax advantages
-Pre tax contributions
-Grows tax free
-Tax free withdrawal for medical expenses

7/ In terms of the most frequently traded stocks it was a lot of familiar names e.g., Big-Tech $AAPL $AMZN $MSFT, along w/ $TSLA & $DIS, meme stock $GME & $AMC, while $COIN cracked the top 10.

For advisors it was all the Vanguard ETF's $VOO $VTEB $VXF $VEA $VWO, etc...

8/ If we look at the trades by region in APAC the top names were $TSLA $AMC $GME $AAPL $PLTR $AMZN $MSFT $COIN, $NIO & $VOO, in LatAm was similar to names of last Q but $KO & $COIN added, while EMEA also added $COIN & $AMZN

9/ They highlighted work from @yield_x as it pertains to the Fixed Income markets & the income required to beat inflation

10/ Finally they talk about the embedded finance evolution & how much room there is to grow for financial inclusion:
-In the US only 1 in 2 Americans has any exposure to the stock markets
-15% of families in the bottom 20% of income earners hold any stock

11/ -White investors own 3x as much stock as Black or Hispanic investors

While Fidelity & @RobinhoodApp won't disclose the #s they both highlighted growth in women investors
-# of women using Fido was +41% in '20 vs. '19
-# of women using RH was +5x from Feb '20-'21

12/ The whole report is worth a read and has impact on not just $HOOD $SCHW $IBKR $NSTB (eventually @DriveWealth) but the @acorns & @SoFi of the world, exchanges, and eventually $SQ, $PYPL, etc...

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