Research uncovered as part of the eToro’s Retail Investor Beat, which was conducted by eToro with this edition supported through a partnership with Nasdaq, a source for financial, economic and alternative datasets, has revealed differences between US and UK retail investors when it comes “to motivations and openness around the topic.”
The research study of 2,000 retail investors from both sides of the pond looked to reveal differences in “behaviors” and “goals” between retail investors from the two nations.
For Americans, the survey showed there is a clear desire to “get the edge in the short to medium term, with US investors more likely to say that achieving financial independence (39% vs 31%) and supplementing income (37% vs 31%) are amongst their main goals.”
Meanwhile UK investors are far more likely to cite ‘funding retirement’ (42% vs 32%) as a key goal.
Investment Goal US Retail Investors UK Retail Investors
- Achieve financial independence 39% 31%
- Fund retirement 32% 42%
- Supplement income 37% 31%
- Investments more of a taboo topic in UK
The study also revealed differences in how both groups “talk about their portfolios with their friends, family members, children, colleagues and strangers.”
US investors tend to be more open than their UK counterparts “to discussing investments, with over 40% discussing a previously taboo subject with their peers.”
eToro and Nasdaq found that US retail investors are more “proactive in building their financial literacy by learning investment knowledge and skills.”
American retail investors are more likely to have “taken an investment course (23% vs 15%), studied strategies of well-known investors (36% vs 28%) and paid for investing tools and resources (22% vs 16%).”
UK-based retail investors also “spend 18 minutes less a week doing research to support their decisions – dedicating an average of 2 hours and 24 minutes to this versus 2 hours and 42 minutes for US investors.”
There are also differences in the “sources of financial news that American and UK retail investors rely upon.”
UK investors are more likely to “trust financial institutions (53% vs 48%) and specialist financial media (44% vs 36%), whereas US investors are more likely to trust friends, family and colleagues (25% vs 19%).”
US retail investors (17%) are also more likely to “leverage AI tools as a part of their overall strategy to research and track various stocks – this falls to 13% amongst UK investors.”
Brandon Tepper, SVP and Global Head of Data, Nasdaq said that Nasdaq partners with clients around the world to drive “more transparency and access to data, which helps retail investors determine how to approach investment strategies based on what is most important to them – whether it be understanding new investment assets, creating long-term wealth management plans, or keeping up with timely information, which can make a material difference.”
eToro UK MD Dan Moczulski added that the retail investing culture has evolved “massively in the UK in recent years and investing is now a topic you’re far more likely to hear in restaurants, pubs and offices than you were a decade ago.”
About this data
This data was collected during eToro’s Retail Investor Beat.
There were 1,000 respondents from the United Kingdom and 1,000 respondents from the United States.
The survey was reportedly conducted from 16 August – 2 September 2024 and carried out by research company Opinium.
Retail investors were defined as self-directed or advised and had to “hold at least one investment product including shares, bonds, funds, investment ISAs or equivalent.”
As clarified in the update, they did not need to be eToro users.