Younger investors are turning to income

The research examines the portfolios of investors over the age of 18 with over £10,000 actively invested in the market.

It shows that investors aged under 25 are more positive about the stockmarket than their counterparts aged over 55 (51 per cent positive v 30 per cent positive).

In spite of their relative inexperience, under 25-year-olds are more likely to have a specific investing outcome in mind than investors aged over 55.

The research also shows that 16 per cent of the investors under 25 have more than £50,000 actively invested in the market, and 56 per cent have more than £20,000 invested.

In the next age bracket, 58 per cent of investors under 35 are currently positive or very positive about the stockmarket, against just 34 per cent of over 35s.

In fact, the older the investor, the less positive they are, with just 30 per cent of over 55s feeling any positivity and 31 per cent feeling somewhat or very negative.

This positivity also stretches to their wider economic outlook. The research shows that while older investors feel jaded towards the European and global economies, younger investors remain positive.

Almost half – 42 per cent – of investors under 25 feel somewhat or very positive towards the European economy, against a tiny 5 per cent of investors over the age of 55.

This trend continues in their sentiment towards the global economy, where 42 per cent of under 25s feel somewhat or very positive, while just 11 per cent of over 55s share the same feeling.

Interestingly, younger investors are more likely to invest for income than older investors. When asked to clarify their primary investment objective, 24 per cent of under 25s cited income, as opposed to just 16 per cent of over 55s.

Under 35s are also the most likely to drip feed into investments, rather than investing via ad-hoc lump sums.

Fifty-three per cent of investors under 35 drip-feed small sums of money into their investments, compared with 29 per cent of investors above that age.

The research quizzed investors with more than £10,000 actively invested in the markets. As might be expected, the amount invested proportionately grows with age, as older investors gather a lump sum ahead of retirement.

Young investors also have a more diversified portfolio when it comes to products, while 78 per cent of investors aged over 55 put money into equities, and only 2 per cent into exchange traded funds or exchange traded commodities, younger investors have a more diversified approach.

What’s clear is that young investors are happy to look more broadly at a range of products, and they feel positive about the future.

When it comes to investing, age really is just a number, and investors across the board can be successful, however experienced they are.

Graham Spooner is investment research analyst at The Share Centre