The millennial generation is considered to be those born between the early ’80s and early ’00s – the generation that are now in their twenties and early thirties.
This generation is notable for being the first to have had access to the internet for all, or the vast majority, of their lives, as well as cellphones.
Now, there is a huge trend towards millennials using online platforms to get into trading on the financial markets, whether it be through services that offer binary options trading like Stern Options, trading foreign currencies on a Forex site, or playing the stock market.
Here, we look at just why online trading holds so much appeal for the millennial generation.
The Financial Climate Millennials Understand
Millennials have not just grown up with things like ecommerce and instant communication options. Having experienced the global financial crisis early in their working lives, been among the first to really feel the student debt crisis, and been exposed to rapidly inflating house prices, millennials have quite a different attitude to money and financial security than previous generations.
They typically have not been able to buy property at a young age, have always had to consider saving for retirement, and have been exposed to a working culture where the concept of a ‘job for life’ isn’t really a thing anymore. They have also been a part of the huge swing towards entrepreneurism and freelance working, and been behind changes in how we think about start-ups – from innovative online businesses to things like crowdfunding.
Because millennials tend to think differently to their parents and grandparents about their financial goals, and because they have experienced more challenges in terms of future financial security, it is no surprise that they are quite interested in investing.
They like the idea of being proactive and trying to make money using knowledge and skill, rather than leaving money idle in a savings account. They are used to trying to find ways to capitalize on their skills and ideas, and in the same way as this drives them to consider business ventures rather than long term employment as an aspiration, it also drives them to try and use the markets as a way of getting more from the money they have.
A Generation of Early Adopters
Millennials were the first to get on board with things like smartphone apps and other mainstream technology, and tend to view innovations with eagerness rather than trepidation. They were the early adopters of social media, and introduced it to their families, which is why now everybody’s grandmother is on Facebook.
Millennials are used to being the first to get to grips with a new technology or way of doing things, and to then lead those things into the wider mainstream use.
This may well be another reason they love online trading as a way of using their finances. Before mainstream internet use and fast broadband, it was virtually impossible for anyone other than banks to trade currencies.
People would only consider buying foreign currencies and looking up the exchange rates if they had to for professional reasons, or were going on a trip to another country and wanted to get some spending money to take with them.
Now, of course, anyone can become a currency trader, and you can trade in real time online with instant price updates on your mobile devices. For millennials, this is another logical thing to get on board with and start using, and as usual, they have gladly been the early adopters learning about how to be successful as a hobbyist currency trader.
Millennials Are Used to Online News and Research
While trading other things like stocks was possible for ordinary people before the rise of online platforms, it was still rather more complicated than it is now, and it was also harder to stay on top of the latest business news that could affect your trades.
For millennials, who have never had to rely on newspapers or TV as their only source of news, and are used to being able to find out about any event anywhere in the world instantly through blogs and user generated content, the idea of keeping your finger on the pulse as a trader comes completely naturally.
Millennials are used to finding out how to do just about anything from a quick online search, and so are not daunted by the idea of researching things that they might stake their money on. They are used to being able to find out what sociopolitical events are going on around the world as they happen, and all of this makes trading feel more intuitive to them than to generations used to struggling to find out the news they are most interested in for their trades from traditional sources.
Millennials Prefer Excitement
Of course, if there is one thing millennials are criticized for more than any other, it is that their long term exposure to the internet has made them accustomed to instant gratification. Millennials are said to have little patience, and to crave excitement.
Online trading is one of the few ways of being financially prudent that actually offers any short term excitement, and this could well be a factor in why younger people prefer the complex and fast paced world of trading to simply sticking their money in a savings account and forgetting about it.
In trading, there are wins and losses, highs and lows, and volatile, exciting times where traders can be under pressure to make the right choices and act fast. This makes it quite exhilarating, even with only a small amount of profit or loss at stake, and millennials enjoy that aspect more than most.
It is interesting to see how easily millennials have adopted things like CFD and forex trading over the past ten years or so, however, when you look at what kind of things millennials generally are interested in and what this kind of money management has to offer, it is quite easy to see why online trading is appealing to them.