Global survey reveals retail investors remain unfazed by uncertainty, with two thirds saying they will keep investing
After a year of underperformance, Big Tech and crypto could see a boost as retail investors express their intentions to invest in the beaten-down assets in the new year, a recent study found.
Most non-professional investors surveyed by investing platform Finimize, which just released its findings, felt the worst of the present market upheaval will end by mid-2023. The survey included more than 2,300 retail investors from North America, Europe, and Asia.
Economic uncertainty, interest rate increases, and decades-high inflation have all had a negative impact on investor sentiment this year, resulting in volatile financial markets.
This year, the tech-heavy Nasdaq Composite is down more than 30% while the S&P 500 index has lost close to 20% of its value.
Retail investors polled by Finimize remained unfazed by the market volatility, with only 1% expecting to sell off their holdings and 65% saying they will keep investing.
In the study, over one-third of participants stated they intended to increase their investment in 2023 compared to this year. One in five people claimed they were increasing their cash holdings to "watch what happens next."
Meanwhile, one in four respondents expected the stock market would bottom out in three months, while a third of those polled said it would happen within six months. One in five people thought the equities market had already bottomed out or was about to do so.
Heavyweight investors are split on the direction that equities will go, but many have adopted a more pessimistic stance for the upcoming year, calling for a "volatile journey" to nowhere, further market declines, and a painful awakening for some traders.
Seven in 10 (72%) respondents to the study said that they intended to invest their surplus income in equities during the following six to twelve months, making individual stocks their favourite investment.
Two-thirds of stock traders said they preferred shares of tech behemoths like Apple, Microsoft, Google, Facebook, and Netflix, making big tech stocks their preferred sector.
2022 proved to be a challenging year for large-cap tech companies, with Big Tech stocks losing US$400 billion by October and many of the industry titans being forced to lay off employees to reduce expenses.
In 2023, sustainable energy stocks came in second on the list of the most sought-after businesses for individual investors wishing to purchase shares.
Over the course of the upcoming year, 60% of survey respondents stated they would invest in index funds.
Despite its decline, cryptocurrencies have remained a popular asset class among retail investors, with a third of participants stating they planned to invest in cryptocurrencies even after the FTX catastrophe. More than half of those surveyed predicted the price of Bitcoin will increase in the next year.
