Gen Z goes trading. Here is what they want from their FX platform
Going multi-asset and offering very sophisticated new products is vital as the new generation of traders go tech and smart
Almost two decades have passed since the turn of not only the century, but the new millennium, heralding a new era.
With the passing of the early millennial years, we can wave goodbye to a few of the accoutrements associated with that period.
We have long since waved goodbye to the Nokia telephone, luminous bracelets with the word ‘Livestrong’ embossed into them, V-neck t-shirts, and digital watches with large screens.
The passing of these trappings has led to the next stage in the elapsing of time, which is that those who were wearing diapers, or had just begun their first kindergarten classes whilst the under 30s of the early millennial years wore wristbands and coveted the latest Nokia phone are now in their early twenties and are as technologically astute, if not more so, than those two decades their senior.
If the Millennial generation, comprising people born in the mid to late 1980s, was the recipient of significant derision from its predecessors, usually via a perception that Millennials are stereotyped as lazy, entitled, and unwilling to conform. The demographic that is now into its 50s often appears to to cite similar examples of a generation who only comes to work if and when they feel like it, and that they have no idea of how to communicate because they are glued to a device for social rather than commercial purposes.
Perhaps this perception has played its part in why the trading platforms that currently exist have remained so ubiquitous for so long, MetaTrader 4 still being a prevalent front end client-facing interface some 16 years after its first release, an extremely unusual scenario in a technology led online business environment.
Change is about to be foist upon all, however, because the next generation, which is referred to by demographers as ‘Generation Z’, is now coming of age.
Generation Z is the demographic cohort after the Millennials. Demographers and researchers typically use the mid-1990s to mid-2000s as starting birth years. There is little consensus regarding ending birth years. Most of Generation Z have used the Internet since a young age and are comfortable with technology and social media.
As the earlier end of this generation now reaches adulthood and begins to enter the investment and trading arena, some interesting observations have been made by large research companies such as Forbes and Bloomberg, some of which suggest that Generation Z has rejected the beard-toting, hipster-orientated nonsense that its predecessor cultivated, and does not rebel against mainstream, conservative progress in business and education.
Quite the contrary. Being raised in an environment in which modern technology existed at the time of their birth, Generation Z is not only technologically astute but is also interested in paving a way ahead which gives them economic freedom, therefore suggesting that many members of this newly matured demographic are intelligent and sensible.
Ann Riley-Moffatt at Bloomberg this morning said “Gone are the days that investing in a beer stock or a mall operator is a good proxy for the youngest American consumers. Today’s portfolio managers trying to capture some extra returns might instead consider investing in cannabis, plant-based meat alternatives and companies that wear their values on their sleeves.”
This viewpoint goes hand in hand with FinanceFeeds opinion that retail FX brokerages need to develop multi-asset investing platforms for sustainability and to approach a new and more enthusiastic trading community.
Also speaking from North America, Bridgette Cady-Thompson, Co-founder & CEO at ARMAGA Media this morning observed ” ETFs tracking Generation Z’s buying preferences, behaviors and influencers will have their day in the sun soon. AssetManagers that rise to meet the demand will win long-term. Retirement plans that provide more customized advice and allocation to changing and increasingly fragmented plan demographics will also win. I have the benefit of being an investor, marketer, oldest of the millennials, and mother to Gen Z and GenAlpha demographic. Pause long-hand math and coding skills for a minute ( they learn that in school). My challenge is getting them involved early in decisions for how they will earn, save, invest and spend their money to advance society and benefit from the coming wave. Now and not wait until they are adults with “real jobs”. That’s too late.”
Sydney-based marketing executive Jacqueline Allen, whose business experience spans across strategic branding for city departments across New South Wales, digital TV and real estate investment, has highlighted that digital platforms for investment are being used outside the mainstream retail trading sector. “While the use of digital platforms and technologies across youth generations may yield no surprises from this latest piece of generational research, there is real insight in workplace expectations” she said.
“Consistent with my own experience is that Millennials (Gen Y) and Gen Z want and expect authentic, values-based leadership with meaningful careers that provide the opportunity for learning, growth, empowerment and achievement. They want the kind of financial stability that the gig economy frustratingly lacks in order to fund their future and dreams” said Ms Allen.
Absolutely right. Aside from the very top end companies in the retail sector which have invested in their own trading infrastructure, such as Saxo Bank, IG Group, Swissquote and Interactive Brokers, firms will have to go down the route of Hargreavees Lansdown in developing centralized platforms that host all investments in one place, including mortgages, bonds, trading environment and retirement plans.
This way, future proofing will be as automated as the systems which Generation Z’s new adults use to operate their everyday lives.
Let’s not forget, MetaTrader 4 was launched before most of these people were born.
Imagine being sold a new car and then being told that you can only listen to music in it on an 8-track player…. Then go and try to find any available music.