Business law

Retail investors are not slowing down in 2023, adopting diversified investment strategies

Retail investors are broadening their interests, diversifying across asset classes and strategies

Investors continue to diversify across asset classes as mega trends and cultural moments lead to the discovery of new investment strategies and opportunities. Increasing the adoption of fixed income strategies in 2023 leads to balancing growth factors that follow popular sectors and companies.

the main ideas:

  • Investors on the public platform have increased the number Featured The asset classes (such as stocks, ETFs, treasury bills, cryptocurrencies, and alternative currencies) that they own 25% Year after year.
  • The share of ETFs in the assets under management of the public portfolio increased 4.4X Year after year.
  • AI thematic ETFs experienced a 34% year-on-year increase in net new investors, with NVIDIA (NVDA) which emerged as one of the most high interest stocks on the platform by page views and trading volume.
  • The cultural buzz, positive and negative, translates to newly converted retail investors. Total number of public investors in Mattel (mat) more 6.6X After the success of “Barbie”, the total number of investors in Bud Light’s parent company AB InBev (bud) on the audience increase 1.5X Despite the controversy that started in April 2023.

Retail investors are increasing due diligence and adopting new research methods such as artificial intelligence

Retail investors place greater emphasis on due diligence and closely scrutinize sources for trust and credibility. Nearly a fifth of the retail investors surveyed say they already use AI in investment research.

the main ideas:

  • When prioritizing sources of financial information, 69.4% of retail investors say trust and credibility are more important in 2023 than in 2022. Majorities say these factors are “significantly” more important.
  • 19% of retail investors already use AI in investment research, and most of the holdouts are investors interested in learning how to leverage AI to guide their portfolio strategies.
  • The growing role of artificial intelligence in investment research is balancing social media as a primary channel for decision making. 16.4% of investors say social noise is an “important signal” in their decision-making process; However, far fewer referred to it as the most important signal.

Retail investors demonstrate changing attitudes about the economy and their roles as shareholders

Retail investors enter the remainder of 2023 with confidence but have mixed feelings about the state of the economy. They also grapple with their roles as shareholders and are divided over the importance of ESG.

the main ideas:

  • Economic outlook is mixed: 59.9% Of retail investors are optimistic or neutral about the economy and 40.1% pessimists
  • 31.1% of investors say their appetite for risk increased by the end of the first half of 2023, compared to 16.7% who reported an increase in their appetite for risk at the beginning of the year.
  • Environmental, social and governance (ESG) issues remain a cultural battleground 55% From investors representing anti-ESG sentiment and 45% Represents pro-ESG sentiment.
  • 27.3% of individual investors say they have participated in a proxy vote so far in 2023. The biggest points of contention have been the lack of awareness of voting and the lack of context around what’s on the ballot.

Individual investor participation remains strong in 2023, as investors focus more on diversifying their investment strategies and looking at fixed income. It is worth noting that the importance of research and information gathering still remains as investors are now adopting technologies such as artificial intelligence to guide their choices before taking any action.

Access and download the full report here.

Downloadable images here.

quotes

“Many investors entered the markets in 2021 on the stock meme craze, but we’re now seeing a long diversified approach as more investors look at fixed income, dividend investing, and AI as new emerging trends,” he said. Kate BerryDirector General of Investor Relations in the Public Sector. “If there is one thing that is clear from our survey and the data – it is that retail investors are not slowing down and still want to participate in the markets.”

“As scholars who advocate that high school students should be taught basic corporate governance rules because it is socially unacceptable for individuals not to be aware of the power that stock ownership and voting holds, we welcome the Public Retail Investors Report as the wake-up call that policymakers need,” he said. Sergio Alberto Grametto RicciUMKC University School of Law, and Christina Souterand SMU Dedman School of Law, who have co-authored several research papers on retail investor engagement. “Most retail investors who fail to vote on their stock do so because they are unaware of their right to vote and of the impact their vote can have. The impact of corporations on our lives, our society and our planet is similar to the impact of corporations on our lives, society and planet. Policymakers must raise the bar on investing education and corporate governance for nearly everyone, as well as promoting policies aimed at making the information provided by issuers more accessible to the average person.

“Reports like this are critical to understanding the changing habits and behaviors of contemporary retail investors,” he said. Alex Thaler, co-founder and CEO of Iconik, a shareholder-sharing technology company. “Specifically, the ideas strongly support the need to separate the purely financial aspects of the investment experience from those of value alignment. At a deeper level, conviction in investing follows a conviction of growth potential and profitability, and it is not clear to many investors whether ESG is about growth potential. profitability or values.”

contributors

This report includes comments and input from:

  • Nick EinhornVice President of Research, Renaissance Capital
  • Jill E FishSaul A. Fox Distinguished Professor of Business Law and Associate Director of the Institute of Law and Economics, University of Pennsylvania
  • Sergio Alberto Grametto Ricci, University of Missouri: Kansas City School of Law
  • Christina Souter, Southern Methodist UniversityDeadman College of Law

methodology

Data from the public platform informed this report through demonstrated behaviors, activities, and qualitative surveys of crowd-sourced retail investors.

This report provides a directional view of the retail investor market, drawn from the general investor community. The ideas shared are not investment advice or an endorsement of any particular investment strategies.

Qualitative research through verified public opinion surveys of investors conducted July-August 2023 (n = 1,015), June 2023 (1,005), and January 2023 (n = 1,036). All surveys reflect responses from individuals with approved/funded accounts on the public platform, US adults over 18 years of age.

about general

Public is an investment platform that allows everyone to invest in stocks, treasury bonds, and ETFs. encryptionand alternative assets, such as fine art and collectibles, all in one place. We help people become better investors with access to customized company metrics, live demos about the markets, and insights from a community of millions of investors, creators, and analysts. Learn more through www.public.com.

Disclosures

Disclosures: Open to public investment and is a member of FINRA and SIPC. This content is not investment advice. Investing involves risk of loss.

Alpha is an experience brought to you by Public Holdings, Inc. (“the public”). Alpha is an AI investment exploration tool powered by GPT-4, a generative large language model provided by OpenAI. Since Alpha is an experimental technology, it may sometimes give inaccurate or inappropriate information. Any output produced by Alpha Company should not and should not be construed as investment research, investment advice, or a recommendation to buy or sell a security, and no output should serve as the basis for any investment decisions. Alpha Outputs are provided “as is” and Public makes no representations or warranties regarding the accuracy, completeness, quality, timeliness, or any other property of Alpha Outputs. We strongly recommend that you independently evaluate and verify any alpha output for your use case.

US Treasury General Investments is provided by Jiko Securities, Inc., a registered broker-dealer and member of FINRA and SIPC. Banking services are provided by Jiko Bank, a division of Central Central National Bank. It is not investment advice.

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Rachel Livingston
Communications manager
(email protected)

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