Participation in online investing continues to grow with emerging brands expanding their reach: Report

From

Dr Irene Guiamatsia

Leading research firm Investment Trends has launched its 2021 2H Online Investing Report, an in-depth study of the attitudes and preferences of online equities and ETF investors in Australia.

The second half of 2021 has seen online investor numbers continue to climb albeit at a slower pace (21.6% increase compared to a 66.6% increase in 2020). Inflows of new-to-market investors and reactivated investors remain strong, but dormancy rates are starting to creep up.

“It is encouraging to see online investor numbers continue to climb in the second half of the year, even as social restrictions began to ease.” said Irene Guiamatsia, Head of Research at Investment Trends. “The growth in Australia was materially higher than rates observed globally, 21% growth compared to 16% growth in the US.”

Millennials and Zoomers continue to dominate the new investor cohort. Their biggest motivators are lower brokerage/fees, access to offshore markets, and a mobile-first digital offering – all of which are strong points of the challenger brands.

“The report shows these younger investors have embraced the innovative product and pricing features on many emerging platforms,” noted Guiamatsia. “Features like fractional shares look set to receive a response similar to what we’ve witnessed in the US, being welcomed by three in five Australian online investors aged under 25 (Zoomers).”

Twice each year, Investment Trends measures the satisfaction of online investors with their main platforms across 16 key service areas. Among full-functionality investment platforms – those that offer domestic and international equities – Superhero has the highest satisfaction in six of the 16 key areas measured, including overall satisfaction. Bell Direct and CommSec round out the top three for overall satisfaction.

In 2H 2021, the winners in each category are:

  • Overall satisfaction: Superhero
  • Value for money: Superhero
  • Functionality: CommSec
  • Customer service: Superhero
  • Mobile platform/app: Superhero
  • Education materials/programmes: Bell Direct

About the report

The Investment Trends 2021 2H Australia Online Investing Report provides a detailed analysis of the Australian online investing market, examining the attitudes, needs and product usage of active online investors.

Based on a survey of 19,508 investors and traders conducted between October and November 2021, the Report is the largest and most comprehensive independent study of the retail online investing market in Australia.

Note: ‘Full functionality’ refers to online investment platforms that offer a comprehensive product range of ASX-listed shares, ETFs, mFunds, ETOs and overseas listed investments.

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