Modern finance is rapidly evolving, and the internet-savvy Gen Z is leading the charge with its own unique investment strategies. Its approach to investment is shaped by a mix of technological savvy, a preference for diversified portfolios, and a keen interest in platforms that democratize access to finance, such as Linqto.
Linqto, which offers a bridge between private equity markets and individual investors, does everything Gen Z wants. It breaks down traditional barriers like high entry costs and complex investment processes, and it allows them to both buy and sell on a user-friendly platform they can access in the form of an app.
Ultimately, Gen Z’s investment style is heavily influenced by technology and digital platforms. According to data from the Financial Industry Regulatory Authority (FINRA) and the CFA Institute, a significant number of Gen Z investors are invested in assets like cryptocurrencies, with many also exploring individual stocks and mutual funds. This diversity in investment choices reflects their comfort with digital platforms and willingness to explore emerging financial trends.
“According to Finra, 55% of Gen Zs are invested in cryptocurrencies and 41% in individual stocks. Linqto is providing them access to these growing trends in a more de-risked way by doing due diligence on the ‘picks and shovels’ technologies and companies that enable cryptocurrencies to flourish, without subjecting its investors to the huge fluctuations and high-risk stakes of individual cryptocurrencies” says Karim Nurani, Linqto’s Chief Strategy Officer.
But beyond an openness to emerging trends, affordability stands out as a key concern for Gen Z. The generation tends to favor cautious spending and diversified investments. Platforms like Linqto, with low investment minimums and an absence of additional fees, cater to this preference, making a range of investment options more accessible to younger investors.
Additionally, ease of use is a critical factor for Gen Z. In fact, it is a must, with those from the internet generation expecting efficient and user-friendly technology. Therefore, investment platforms that simplify the process and allow for informed decisions through intuitive interfaces, like smartphone apps, are particularly appealing to this generation.
“Gen Zs have a tech-native mindset so they expect seamless experiences in their investment platforms. Linqto’s mobile-first platform is clean, simple, and very easy to use. It’s also packed with educational information,” adds Nurani.
Flexibility and control in investments are also important to Gen Z. Features like the liquidity provided by Linqto, which enables users to buy and sell on the same platform, meet Gen Z’s expectations for comprehensive management capabilities in their investment choices.
Additionally, while Linqto’s approach to risk assessment and investment aligns with Gen Z’s cautious style, it’s just one aspect of a broader trend. Gen Z is increasingly proactive in financial planning, as shown by Bank of America’s research indicating that 19.3% of Gen Z retirement plan participants increased their contribution rates, surpassing other age groups.
Gen Z’s diverse approach to investing, blending technology use with varied investment avenues, indicates a shift in personal finance. They are not just diversifying portfolios but also redefining the essence of investing. Their strategies, influenced by digital integration and a range of investment opportunities, suggest a future where investing is more inclusive, informed, and adaptive to technological advancements.
Therefore, while platforms like Linqto are instrumental in providing access and tools aligning with Gen Z’s preferences, the broader picture of Gen Z’s investment strategy reveals a significant departure from traditional norms. It’s a blend of technological integration, diversity in investment choices, and a strong inclination towards platforms that offer transparency, flexibility, and alignment with their values and financial goals.
