The AIC published an interesting press release last week. It was headlined “Young people more aware of cryptocurrency than any other investment”.
Young people they class as those aged 20-40 but it shows an astonishing ignorance of different types of investment. Even more astonishing is that they rely on web searches, Instagram, YouTube, Facebook and Twitter as sources of financial information.
Some 70% of survey respondents were aware of cryptocurrencies such as Bitcoin, but only 18% of investment trusts.
The fact that most of these media that young people reply on are motivated by the desire to sell something to investors shows how easy it is for young investors to get misled. You can see why new investors are so easily sucked into speculative investments of one kind or another.
See https://www.theaic.co.uk/aic/news/press-releases/young-people-more-aware-of-cryptocurrency-than-any-other-investment for the full press release.
How to solve this problem? Education if one key and at a young age. But anything taught in school at age 15 will soon get forgotten, and be swamped by clever marketing by financial promoters.
ShareSoc has been working on this issue via their “Investor Academy” (see https://www.sharesoc.org/investor-academy/ ) but it does not seem to be having a great impact so far. There is little incentive to learn.
The only way I can see this state of affairs improving would be if investors had to pass a qualifying examination before they could invest in some types of investments. Having “health warnings” on cryptocurrency investment schemes is not enough.
Roger Lawson (Twitter: https://twitter.com/RogerWLawson )
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