The Most Popular Investments for Retail Investors in 2024

Investing has always been a popular way for individuals to grow their wealth and secure their financial future. With the rise of online trading platforms and easy access to financial information, more and more retail investors are getting involved in the stock market. A recent report from trading platform eToro sheds light on the most popular investments for retail investors in 2024.

Financial Services Stocks and Cash Take the Lead

According to eToro’s Retail Investor Beat (RIB) report, financial services stocks and cash are currently the top choices for US retail investors. The report, released recently, revealed that 54% of investors are holding financial services stocks, with technology stocks coming in a close second at 49%. Energy stocks and communications shares followed at 39% and 36%, respectively.

The collapse of Silicon Valley Bank last year led to a regional banking contagion, causing financial sector stocks such as Charles Schwab, U.S. Bancorp, and PNC Financial Services to trade below their pre-crisis levels. This has attracted value investors looking for opportunities in the sector.

Technology Stocks Remain a Strong Contender

Technology stocks have always been a favorite among investors, especially with the recent surge in generative artificial intelligence (AI) stocks. Chipmaker Nvidia has been leading the pack in this sector. Despite the strong performance of technology stocks, some investors still feel they may have missed out on the gains. However, 22% of US investors are looking to increase their exposure to technology stocks.

Younger investors, in particular, are showing a preference for cryptocurrency assets. The report indicates that 26% of investors aged 18-34 are planning to increase their digital investment portfolio over other assets. This younger demographic is also more likely to buy on market dips and remain cautious after experiencing losses.

Inflation Concerns Loom Large

While the market has seen some easing in US inflation recently, 30% of investors still view inflation as the biggest threat to their portfolio. This is followed by concerns about the economy (21%) and high interest rates (11%). Despite these challenges, investors are holding onto cash assets for a risk-free return and to take advantage of market opportunities when they arise.

“With interest rates still elevated in the US, it’s no surprise that investors are leaning into cash assets for a solid risk-free return,” said Bret Kenwell, eToro’s U.S. investment analyst. “Investors’ cash holdings put them in a good place to take advantage of market opportunities when they arise.”

Conclusion

As retail investors navigate the ever-changing market landscape, it is essential to stay informed about popular investment trends and strategies. The eToro report provides valuable insights into where retail investors are putting their money in 2024. Whether it’s financial services stocks, technology shares, or cryptocurrency assets, there are opportunities for investors of all ages and risk profiles to grow their wealth and achieve their financial goals.

For more information on retail investor trends and market insights, visit Investopedia.