Inflation and the upheavals caused by the war in Ukraine did not lead individuals to flee the financial markets. Individual shareholders are even more numerous and maintain confidence.
The Sotck exchange seduced again. Despite an uncertain context, dominated by inflation and the tightening of monetary policies in banks central banks, individuals continue to invest in the markets, including the youngest ones. More than 80% of stock market investors believe that the markets remain an attractive investment over the medium and long term, according to an OpinionWay poll conducted for Fortuneo. Contrary to what one might think, the rise in consumer prices may even turn out to be an investment driver. Thus, 68% of individual shareholders declare that investing in the stock market is a means of obtaining additional income.
These statements echo the transaction flows observed by the AMF (Financial Markets Authority). Director of relations with savers, Claire Castanet, notes that “companies which pay dividends or those whose shares can be bought and resold easily, attract more investment from individual shareholders”. Same story with Grégory Guermonprez, director of Fortuneo. In total, 44% of online banking customers are looking for investments that yield dividends.
Transactions carried out on the stock market depend on the age group and income of individual shareholders. “You are not going to invest in the same way depending on whether you are a student, a young employee or a senior professional, because your income and your expenses are not the same”, recalls Philippe Guillot, director of markets and data at the AMF. . Claire Castanet affirms that the youngest “seem to invest more willingly than their elders in companies located outside of Europe”. The American market and tech companies are therefore very popular with these new investors.
The older ones prefer Cac 40 companies in particular. The director of investor relations at the AMF notes a tendency for new individual shareholders to prefer planned investments. The latter are “more suitable for people with small budgets”. Indeed, they allow “to spread the investment over time by regularly placing a certain amount of money on the stock market”, underlines Claire Castanet.
More cautious investors?
If the method of investment differs according to the profiles, it is the same for the sums invested. AMF’s Philippe Guillot says the average transaction amount is €2,600 for a typical customer of a traditional bank. For followers of neo-brokers, such as eToro or Trade Republic, who are often younger, the average amount of a transaction is lower, since it reaches 700 euros. Regarding the overall amounts invested, Grégory Guermonprez detects little difference between the sums spent by young people and the oldest. They invest respectively 4,000 euros and 10,000 euros. And the gap tends to narrow every year.
The inflationary context still has an impact on the behavior of individuals on the stock market. In the third quarter of 2022, the Autorité des marchés financiers (AMF) noticed a 35% decrease in the number ofinvestors having carried out at least one transaction, purchase or sale of shares, compared to the previous quarter. However, it is difficult to draw any conclusions. “This wait-and-see attitude can be interpreted in different ways”, nuances Philippe Guillot, director of markets and data at the AMF. “It may mean that individual shareholders are cautious about inflation, or it may just as well mean that investors are happy with their current positions and do not wish to change them at this time.”