Why Is The New Generation Moving Towards The Share Market?
The share market has always been attractive for people. A huge number of investors have entered the stock market during the pandemic. Most of these investors are first-time investors, and still, they chose to invest in stock market. It shows their progressive investing behaviors. Let us find out reasons that are alluring the new generation to move towards the share market.
1. Easy accessibility to the market
The rise of trading apps is one of the reasons and main support for new entrants. The registration process for online share trading has become much easier and affordable now-a-days. They can access the market easily using an online demat and trading account from any corner of the world. Besides easy accessibility, stockbrokers impart knowledge about stocks with the help of real-time market updates and price trends. They can utilize their time more efficiently. No person would choose to sit idle if they can make money from the stock market.
2. Risk-takers
The reason is easy to accept because the new generation is more likely to take risks than their elders. They are ready to diverge from the fixed income assets. Young investors are shifting investing trends globally with their moves towards the market.
3. Easy handling of financial securities
With the introduction of online trading, there is no worry about handling financial securities. Investors can hold a variety of financial securities in their demat accounts. There is no fear of loss or damage of certificates and forgery issues. They need not visit any stock exchange to place a trade to buy or sell stocks. Stockbrokers provide a basic trading platform with a demat account. Investors can utilize their time in more learning that was wasted earlier in the queues of stock exchanges.
4. Margin Trading Facility
Stockbrokers provide the facility of margin trading to their clients. This facility is very helpful to grab a short-term opportunity available in the stock market, even if the trader lacks the required funds. Day traders can borrow an amount of money to invest in beneficial financial security. If a young investor is financially stable, he/she can choose day trading because day trading is hugely risky, that one can lose all the money in the blink of an eye, especially for new entrants.
5. Low commissions on trading
The stockbroking market is a competitive market. Stockbrokers offer a number of offers to investors to attract them to open brokerage accounts. In such a competitive edge, they trim demat maintenance expenses and offer a lower commission rate for trading. Thus, trimmed brokerages result in low-cost investing. It is what exactly a new youth participant will want. Younger investors keep on searching online for better deals for small brokerages. Thus, stockbrokers are making online trading India more affordable now.
6. Long term prospect
Youth is very active on social media platforms. These are the platforms utilized by financial institutions to spread awareness for investing. They make their readers understand the importance of early investing and how valuable long-term investments are. Investors need not make a hole in their pocket to accumulate a significant amount in the run. A small contribution can also experience the power of compounding over time. The legendary investor Warren Buffett advises investors to invest for the long term and avoid trading commissions as much as possible. It will reduce the expense compounding effect and save your money.
7. Progressive Regulations
Following the pandemic and lockdown, the market regulator SEBI has eased market participation that results in the current boom. In April 2020, it reduced broker turnover fees to 50% of the existing fee structure. The digitization of the entire know-your-customer (KYC) process has also encouraged youth.
Thus, the relief from the government and support from stockbrokers have been major reasons that make the stock market participation easy and affordable for youth.