Australian women are outnumbering men participating in the ASX Sharemarket Game.

For the first time in the 25-year history of the ASX Sharemarket Game, younger Australian women are outnumbering men participating in the game, growing their market knowledge and investment skills in a low-risk environment.

In 2023, participation by women aged under 40-years increased by 12% compared to 2022 (14% in 2022 to 26% in 2023). This is a historical moment in the 25-year history of the Sharemarket Game, with the proportion of women aged under 40-years representing 28% compared to 25% of men.

ASX Head of Equity Markets, Graham O’Brien commented on the development, “We are seeing a changing of the guard in the profile of participants in the ASX Sharemarket Game, a development that reflects the changing habits of Australians holding assets outside the home and super, but also a continuation of the inspired appetite for investing we saw during the COVID-19 pandemic.”

According to the ASX Australian Investor Study 2023, the trend for younger Australians to participate in share investing is being driven by the surge in investing which began during COVID-19 lockdowns, and which has continued over the past two years.

There has also been an increasing number of Australians holding investments outside their home and super through the sharemarket – 75% or 7.7 million of the 10.2 million Australians who now hold investments outside their home and super, invest in the sharemarket.

Rising property prices and cost-of-living pressures have also influenced people to consider investments outside their home and superannuation and to seek out tools such as the ASX Sharemarket Game to learn how to invest.

Meanwhile for women, more opportunities to participate in financial markets via Apps, online brokers and investment platforms has made financial markets more accessible, opening a world of investment possibilities beyond the home and superannuation. Greater focus on financial literacy and financial independence has encouraged women to plan for their financial future.

New trends drive Game growth

The 2023 ASX Australian Investor Study found 9% of current investors now fall into the next generation demographic (aged 18-24 years) and 63% of this cohort have only begun investing for the first time in the past two years.

Women account for 42% of current investors and the percentage of women who are next generation investors has increased from 9% in 2020 (when the ASX study was last done) to 11% in 2023. For the first time ever more Australian women invest outside their primary residence and superannuation.

O’Brien says the changing profile of sharemarket investors has highlighted the role educational tools such as the ASX Sharemarket Game can play in preparing new investors and understanding market volatility, which has been a challenging factor for participants in the current ASX Game.

“The sharemarket has experienced periods of market volatility during the 2024 games period, inching out a small 0.3% rise to date. The volatility has required game participants to ride out the ups and downs of day-to-day share price movements, made easier for those new to investing as the virtual cash provided in the game makes it less risky to test out a new strategy before having real skin in the game.”

About the Game

Launched in 1999, the ASX Sharemarket Game is now experiencing unprecedented participation. Designed as a virtual sharemarket game, it helps participants get familiar with stocks and sectors and to develop knowledge about risk and reward trade-offs.

The game provides investors with $50,000 in virtual cash to create their own investment portfolio. The updated game format for 2024 creates an even more authentic investing experience by providing a slightly longer window to test strategies.

During the 26-weeks of the game, participants can invest in over 300 ASX-listed companies, including ASX 200 companies, small and mid-cap companies as well as Exchange Traded Funds and Listed Investment Companies. Participants can also place orders to buy or sell shares any time the market is open.

The ASX Sharemarket Game is free to enter for participants over 18-years and features real market conditions, live prices, and brokerage fees. Cash prizes are available for first, second and third with a best university portfolio, minor league (up to 10 members) and major league prizes (more than 10 members) also available.

Members of the public can participate in the 2024 Sharemarket Game with registrations closing on Thursday 25^th July.

Register here.

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In conjunction with the Australian Securities Exchange (ASX), Global X has released the Global X S&P/ASX 200 Covered Call ETF (ASX Code: AYLD) which will track the S&P/ASX BuyWrite Index.

Graham O’Brien, ASX Head of Equity Market Sales and Equity Derivatives says buy-writes are the most popular options strategy amongst Australian investors, combining the flexibility of listed options with share ownership.

“AYLD aims to enhance income potential and reduce portfolio volatility compared with outright share ownership. As the first options strategy ETF listed over an index, investors can access a long back history of performance by reviewing the index history supplied by S&P,” O’Brien says.

Global X has also launched the Global X Nasdaq 100 Covered Call ETF (ASX Code: QYLD), which will track the Cboe Nasdaq-100 BuyWrite V2 Index; and the Global X S&P 500 Covered Call ETF (ASX Code: UYLD), which tracks the Cboe S&P 500 BuyWrite Index. Both funds are already listed in the US and represent the two largest covered call ETFs in the world, measured by assets under management.^[1]

A covered call (also called a buy-write) involves selling call options over stocks an investor already owns. Selling a call option generates income in the form of a premium. Investors selling call options are still eligible for dividends and franking credits from their shareholdings. The premiums can be a source of a substantial amount of alternative equity income, depending on market conditions.

Blair Hannon, Head of Investment Strategy at Global X says the three funds can help investors balance portfolio growth and income.

“We consistently hear how important income is to investors across all age groups. We see options strategies, incorporated in ETFs, as a great entry point for investors to supplement existing income sources like dividends or coupons from bonds.”

“Used as a core equity holding, the options premiums of a covered call ETF can smooth the impact of market falls. In this way, it provides investors with potential protection against drawdowns,” Hannon says.

“Alternatively, a satellite portfolio holding can be used to generate an alternative source of income, especially in times of heightened volatility or rising interest rates. This was evident when QYLD and UYLD generated high yields above 12 per cent in the second half of last year.”

Using covered calls is a well-established income generation and downside protection strategy among sophisticated investors.

Hannon says the suite of covered call funds enables more Australian investors to access this type of strategy in a simple and cost-effective form that provides efficient options execution.

“A covered call strategy accessed through an ETF can save investors the time, potential expense and complexity of doing it themselves,” Hannon adds.

All three funds invest in their indexes on a fully replicated basis. In the case of AYLD, the fund invests in the S&P/ASX 200 and then sells quarterly exchange traded call options against the index, worth roughly 100% of the value of the portfolio. Options are rolled to the next quarter the day before expiry.

The income generated by selling call options can help portfolios maintain performance during period of falling markets or sideways trading. In addition, call option premiums usually rise during periods of higher interest rates and market volatility. The trade-off is that upside potential may be capped, as the options may be “called” if markets move higher.

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Notes:
[1] (ETF.com, 2023)

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