Millennials’ appetite for crypto ETFs surges as traditional investors catch on, Schwab study shows

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The Block2024/10/09 16:00

By:The Block

Quick Take Schwab Asset Management has released its annual ETF study, which shows investors have their eyes set on crypto over the next year. Millennials report higher levels of interest in a host of ETF types and asset classes, with cryptocurrency near the top of the list.

Millennials’ appetite for crypto ETFs surges as traditional investors catch on, Schwab study shows image 0

It is no secret that Millennials and Gen Zers have investment philosophies that differ from Baby Boomers and Gen X. It seems, however, that the launch of spot bitcoin exchange-traded funds earlier this year, and later the addition of spot ether ETFs, helped bridge that gap.

Thursday's release of the annual Schwab Asset Management ETF study zeroes in what investors are interested in over the next 12 months, and crypto is top of mind.

"Millennial ETF investors have the strongest appetites for ETFs and are most interested in more personalized ways to invest," Schwab wrote in the release. "They have higher levels of interest in direct indexing and are more likely than other generations to invest in direct indexing in the next year."

Millennials report higher levels of interest in several ETF types and asset classes. According to the Schwab survey, 62% of Millennials plan to invest in cryptocurrency ETFs over the next year, the highest percentage of asset classes. For Gen X, the figure was 44%, while just 15% for Boomers.

"Millennials report significantly higher levels of confidence," the release said. "They are more likely to think they have the skills to outperform the markets and more likely to say they prefer to take on more risk for higher returns."

More broadly speaking, ETF investors grew more bullish toward several sectors over the last year, and more of them plan to invest in cryptocurrencies via ETFs.

Schwab said ETFs make up 27% of ETF investor portfolios today, while 65% plan to increase ETF investments in the next year. Meanwhile, a different study from the Alternative Investment Management Association (AIMA) finds that 47% of traditional hedge funds now have exposure to digital assets, with 43% seeing increased interest in crypto from institutional clients.

Since going live in January, spot bitcoin ETFs have generated a cumulative trading volume of $426 billion, according to The Block's data dashboard . BlackRock's IBIT leads the way with a market share of nearly two-thirds. Many industry experts have called it the most successful ETF launch ever. "Investment advisors are adopting bitcoin ETFs faster than any new ETF in history," Bitwise Invest CIO Matt Hougan said las month.

Schwab surveyed 2,200 individual investors between the ages of 25 and 75 with at least $25,000 in investable assets. 1,000 of whom have bought or sold ETFs in the past two years and 1,000 of whom have never bought or sold ETFs or have not bought or sold ETFs within the past two years. The survey respondents included 200 investors who started investing in 2020 or after.

The study was conducted from July 2 to July 20, before the debut of the Ethereum ETFs .

Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

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