Investing Apps: Why Are Retail Investors Using Them?
Investment apps have become increasingly popular among retail investors. Notably, the popularity of investment apps has been triggered by the cryptocurrency market & Covid-19, which saw interest in both investing and investment apps soar to record highs. But beneath the obvious story, what are the real reasons investors are turning to them? One answer is the new levels of accessibility they offer.
Investing in the modern-day digital world is easier than ever because of the availability of investment apps. Investments apps are suitable for all investors, but they have become more popular among retail traders. With the right investment app, a trader can find it very easy for them to achieve their investment goals.
The rise of investment apps
According to this Top 10 Best Investment Apps of 2022 article by Invezz, the popularity of investment apps soared during the pandemic. During this time, volatility in the financial markets increased significantly out of fear. A Credit Suisse report estimated that in 2021, retail traders accounted for one-third of the US stock market.
Using complex trading platforms like over-the-counter trades and brokers can be tedious when making small investments. Retail traders have turned towards investing apps because it is easier for them to open and close trades in the comfort of their homes.
Investment apps have also become convenient to new investors because they offer ready investment advice, increasing the chance of that investor learning about the market quickly. Investing apps also charge significantly low costs, making them ideal for retail day traders.
All these factors have fuelled the growth of investing apps. The retail global investment market has expanded significantly over the past year, as evidenced by the app’s trading & download volumes, reported by Streetinsider. Investing apps that focus on user-friendliness and low trading costs have become increasingly popular.
Investment apps offer greater accessibility
Traditional investing is very costly and involves complex processes. Investment apps have simplified the process by allowing individuals to access assets across global markets without an intermediary.
Individuals using investing apps tend to have small account balances and trade more frequently. However, they also seek financial advice just like experienced traders. These trading apps also boost the accessibility of financial and investor resources, with social media playing a key role in driving adoption.
In the modern-day investment world, it has become very easy for investors to access information that will help them make informed decisions. While retail investors tend to make small traders, some of the top investing apps have also allowed them to set long-term investment strategies.
Crypto is fuelling the adoption of investment apps
Cryptocurrencies have become increasingly popular as an asset class despite their volatile nature. Retail investors have shown increased interest in the crypto market, with trading volumes increasing during market highs and lows. During the first quarter of 2021, it was estimated that retail investors bought around 187,000 Bitcoin, which was significantly higher than institutional investors.
(Featured image by Liza Summer via Pexels)
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