Young investors shun meme stocks and crypto for gold: The Royal Mint
00:01, 8 September 2021
Meme stocks and crypto investments are falling out of favour with young investors, according to research conducted by The Royal Mint.
The UK’s government-owned coin producer found that over half (54%) of millennials and Gen Z surveyed, felt their cryptocurrency or meme stock investment was unsuccessful, didn’t gain as much as they had hoped or had lost them money.
The majority (64%) of younger investors have already ditched some or all these types of investments in favour of safer options, like gold.
Get rich quick?
Over two thirds of younger investors (68%) are now considering investing in precious metals following their disappointing experience with crypto and meme stocks.
They told The Royal Mint researchers that they were motivated by precious metals’ history of consistent growth and reputation for holding value over time.
Millennials and Gen Z investors added that they felt disillusioned by crypto and meme stock performance after being lured by their supposed “promise” of a high return.
Meme stocks, like GameStop and AMC Entertainment Holdings, and cryptocurrencies have gained much media attention over the last year, fuelled by a get-rich-quick culture and FOMO (the fear of missing out) among young investors.
Going for gold
The Royal Mint has welcomed the new trend, which has resulted in increased interest in its DigiGold product.
“The rise of meme stocks in the late half of 2020 and early 2021 has really opened up the idea of investing to a new, younger group of people. It’s great to see a new financially savvy generation is emerging, realising the benefit of a diverse portfolio,” said Andrew Dickey, director of precious metals at The Royal Mint.
The product appears to appeal to younger investors’ digital prowess as well. “With the millennial age group, we’re finding that our DigiGold product is proving particularly popular. It offers people the chance to invest in small portions of physical gold that is physically held in our vault, at the touch of a button, via a smartphone or tablet,” added Dickey.
Other precious metals
The Royal Mint also offers investors the ability to diversify their savings into silver and platinum, through its DigiGold platform.
Further, unlike precious metal coins or bars, DigiGold enables buyers to purchase gold, silver and platinum, based on monetary value rather than weight.
The management fees are charged at 0.5% VAT per annum based on the average daily market value of an investors’ total metal holding that is stored at The Vault, the Mint’s secure vault based in South Wales.
“Investors own their DigiGold investment and have a legal title to it, with The Royal Mint acting as custodian only. Customers can invest from as little as £25, making it ideal for first-time investors,” said Dickey.
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