Older Investors Embrace AI, Gen Z Remains Cautious, Says Apex Fintech Study
A recent study conducted by wealth management software provider Apex Fintech Solutions reveals that older investors are embracing artificial intelligence (AI), while Generation Z remains cautious. The Q2 2023 Apex Next Investor Outlook (ANIO) report examines investing trends in response to various market triggers such as a potential recession, inflation, interest rates, and tech layoffs.
One of the key findings of the study is that investors, regardless of their generation, are moving past their COVID-related concerns. Interestingly, Gen Z, which is often associated with being more experimental, showed a more conservative approach in the second quarter, refraining from investing in AI stocks.
Connor Coughlin, Chief Commercial Officer of Fintech at Apex Fintech Solutions, expressed his astonishment at the shifting investing patterns identified in the report. He stated, What’s remarkable about our Q2 ANIO report is how many investing stereotypes were broken.
The ANIO report analyzed data from investors trading through the Apex Clearing Platform during Q2 2023. It encompassed 1.3 million accounts from Gen Z investors and 5.6 million accounts from millennials, Gen X, and baby boomers.
Here are some of the key takeaways from the ANIO report:
1. Investors Favor Cruise Stocks: Despite the ongoing pandemic, cruise lines saw heavy investments across all generations. Norwegian Cruise Lines, Carnival, and Royal Caribbean attracted significant attention from investors. Carnival reported a record-breaking $7.2 billion in customer deposits, Royal Caribbean experienced increased bookings at higher prices, and Norwegian Cruise Lines reached over 100% occupancy for the first time since the pandemic.
2. Gen Z’s Cautious Stance on AI: Surprisingly, Gen Z exhibited less enthusiasm for AI compared to millennials and Gen Xers. While AI software provider C3.ai surged in popularity among the latter two generations, Gen Z chose not to jump on the AI bandwagon, resulting in no significant movement of AI-related stocks in this cohort.
3. Technology Stocks Regain Momentum: Technology stocks remain a popular choice for investors across all generations. The top 10 stocks among all cohorts include Tesla, Apple, Amazon, Nvidia, Microsoft, Meta, Google, AMD, Berkshire Hathaway, and SoFi.
4. Gen Z’s Reduced Bullish Trading: Gen Z investors displayed a more cautious approach in Q2, scaling back on bullish trading compared to the previous quarter. This shift could be attributed to various factors such as the crash of First Republic Bank, negative press surrounding AI from Google, and the departure of a prominent figure in the AI industry.
Understanding the changing needs and behaviors of retail investors has become crucial for advisors and fintech companies, emphasized Coughlin. The ANIO report sheds light on these evolving trends, providing valuable insights for industry professionals.
In conclusion, older investors are embracing AI while Gen Z remains cautious, according to the Apex Fintech Solutions study. The report challenges existing investing stereotypes and highlights the importance of understanding and catering to the preferences of different generations. As the investment landscape continues to evolve, staying informed about these shifts becomes increasingly vital for advisors and fintech companies alike.
