Exchange-traded funds (ETFs) are becoming increasingly popular among retail investors in the United States, with their usage rising from 31% in 2018 to 47% in 2023 and expected to exceed 50% by 2025. According to a study by Broadridge Financial Solutions Millennials and Generation Z investors are increasing their market share and redefining investment trends by choosing self-directed investing.
The investment landscape in the United States is undergoing major changes, driven primarily by younger generations who are adopting new strategies and tools. Since 2018, there has been a marked rise in self-directed investing, with 23% of all assets now managed through online discount brokerage platforms, up from 14%.
This trend is not limited to young investors; High net worth individuals also prefer self-directed channels, with approximately 25% of their assets in this category. This shift highlights a broader trend among investors who increasingly prefer ETFs and U.S. stocks over mutual funds.
Source: Broadridge
For the first time, mutual fund assets fell below stock assets in individual portfolios, with ownership falling from 72% in 2018 to 62% in 2023. The number of millennial investors has increased by nine percentage points since 2018, and they are in Their path to greater success. Go beyond Gen-X investors.
This demographic shift is accompanied by an increase in the average number of investments held by millennials, rising from six in 2018 to ten in 2023. The democratization of investing is further evident in the rising proportion of investors without a college degree, which exceeds Now 50%. .
Gender dynamics in investing
Another interesting finding from the study was the comparison of average assets between male and female investors. Female investors now have higher median assets than their male counterparts, at $52,105 compared to $50,271 for men. This development indicates a shift in women's financial empowerment and highlights the increasing participation of women in the investment landscape.
The appeal of mutual funds is waning, especially among younger investors. Boomers still allocate the highest percentage of their assets to mutual funds (39%), but younger generations are increasingly looking toward alternative options like ETFs and stocks. Since 2018, Gen-Z stock asset ownership has doubled, Millennial ownership has more than tripled, and Gen-X has seen significant increases as well.
Source: Broadridge
The study also highlighted the relationship between education and asset ownership. Investors with only a high school diploma have significantly less assets ($28,332) than those with college ($73,044) or graduate degrees ($148,399). Despite the rise of self-directed investing, this gap highlights persistent disparities in financial outcomes based on educational attainment.
Exchange-traded funds (ETFs) are becoming increasingly popular among retail investors in the United States, with their usage rising from 31% in 2018 to 47% in 2023 and expected to exceed 50% by 2025. According to a study by Broadridge Financial Solutions Millennials and Generation Z investors are increasing their market share and redefining investment trends by choosing self-directed investing.
The investment landscape in the United States is undergoing major changes, driven primarily by younger generations who are adopting new strategies and tools. Since 2018, there has been a marked rise in self-directed investing, with 23% of all assets now managed through online discount brokerage platforms, up from 14%.
This trend is not limited to young investors; High net worth individuals also prefer self-directed channels, with approximately 25% of their assets in this category. This shift highlights a broader trend among investors who increasingly prefer ETFs and U.S. stocks over mutual funds.
Source: Broadridge
For the first time, mutual fund assets fell below stock assets in individual portfolios, with ownership falling from 72% in 2018 to 62% in 2023. The number of millennial investors has increased by nine percentage points since 2018, and they are in Their way to greater success. Go beyond Gen-X investors.
This demographic shift is accompanied by an increase in the average number of investments held by millennials, rising from six in 2018 to ten in 2023. The democratization of investing is further evident in the rising proportion of investors without a college degree, which exceeds Now 50%. .
Gender dynamics in investing
Another interesting finding from the study was the comparison of average assets between male and female investors. Female investors now have higher median assets than their male counterparts, at $52,105 compared to $50,271 for men. This development indicates a shift in women's financial empowerment and highlights the increasing participation of women in the investment landscape.
The appeal of mutual funds is waning, especially among younger investors. Boomers still allocate the highest percentage of their assets to mutual funds (39%), but younger generations are increasingly looking toward alternative options like ETFs and stocks. Since 2018, Gen-Z stock asset ownership has doubled, Millennial ownership has more than tripled, and Gen-X has seen significant increases as well.
Source: Broadridge
The study also highlighted the relationship between education and asset ownership. Investors with only a high school diploma have significantly less assets ($28,332) than those with college ($73,044) or graduate degrees ($148,399). Despite the rise of self-directed investing, this gap highlights persistent disparities in financial outcomes based on educational attainment.
