On Friday, June 24, the results of the United Kingdom’s referendum on whether they would choose to leave the European Union or elect to stay, were announced. Dubbed the “Brexit,” an obvious amalgamation of the words “Britain” and “exit,” the UK decided that it would indeed be leaving the EU, and Prime Minister David Cameron promptly stepped down from his post. And, as quickly as Cameron and the UK made the decision to remove itself from the EU, American investors began selling their stocks in fear of a plummeting market.
There was, however, one group that largely chose not to sell its stocks amidst the Brexit market crisis. In fact, this group bought more stock during post-Brexit fallout than did any other group. That group–more of a generation–was the Millennial market.
Previously, I wrote about how the App boom isn’t slowing down, we’re just getting smarter with what apps we download. The announcement from CNN Money, headlined with the fact that Millennials using Fidelity’s brokerage platform “made 270% more stock purchase than sales, according to stats shared exclusively with CNNMoney,” backs that notion up. Millennials, the generation often chided for their addiction to smartphones, video games and a focus on self-interest, are making some of the smartest investing decisions happening on the market right now.
Coming off of an enormous drop in the Dow Jones, Millennials chose to go against the grain, buying 2.7 stocks for every stock sold and embodying the advice of billionaire Warren Buffett when he advised that we “be fearful when others are greedy and greedy only when others are fearful”. Others sold their stocks, choosing to get out while they could, fearful of an even larger drop in the near future as the world felt the effects of the Brexit. Young people, however, took Buffett’s advice and erred on the side of greedy, buying stocks, confident that the market would rebound.
And it did.
While the market hasn’t quite reached pre-Brexit levels just yet, the slow rebound has taken effect. The increase in stock purchases over stock sales after the Brexit points to a couple of trends in the market today that are worth noting. Our economy may actually be healthier than we may have thought. Millennials are becoming more and more involved in playing the stock market. And of course, sometimes calculated risk can pay off, as long as it’s done intelligently.
The CNN Money article titled “Millennials were buying as the world was getting out of stocks during Brexit scare” pointed towards large influxes of millennial-aged buyers over sellers during the Brexit scare, sourced its data to backup Fidelity from Robinhood, a popular app among younger people. Once the VERB app is launched, the way millennials are investing will change. While younger people showed boldness in buying after the Brexit crisis, VERB could have facilitated an even larger movement for the generation that is only just now beginning to involve itself in intelligent money and investment management.
VERB is set to launch in just under three months. To subscribe, and to learn more about VERB, its creators and the gamification of the stock market, visit Verb.World.