Over 1 in 4 Australians are investing in the ASX: report

27% of Australians are actively investing the ASX, a new report by website Finder claims. Click on to find out more on this development.

ASX bank shares buy A young boy in a business suit giving thumbs up with piggy banks and coin piles

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

27% of Australians are actively investing in the ASX, a new report by website Finder claims. The report found Australians saved an extra $113 billion during the coronavirus pandemic but low-interest rates drove Aussies to invest that money in the stock market, rather than their bank accounts.

Over the past year, the S&P/ASX 200 Index (ASX: XJO) increased 30.05%, making 2020 a rather fruitful year to enter the stock exchange game. Of course, the market over a year ago had just crashed due to the pandemic. The one-year anniversary of the crash was last week.  

Let's take a closer look at the details.

More Australians are taking risks with their money

The number of Australians investing who own shares, like in the ASX, lags compared to other nations. Comparatively, 33% of Britons and 35% of Americans are shareowners. However, the number of Aussies who became shareholders did jump over the past year. The number of Australians investing in the ASX increased by 48.2% during the pandemic.

Shares are the most popular form of investment for Australians, followed by exchange-traded funds (ETFs) (10%), additional super contributions (8%), and foreign currency exchange (6%).

One likely factor fuelling the retail trader boom is Australia's historically low-interest rates. Minutes from the last RBA meeting reveal the central bank doesn't expect to raise the official cash rate until 2024 at the earliest.

According to Kylie Purcell, investments product expert at Finder, Australian attitudes to investing money are changing.

"Traditionally, Australia has been a fairly risk-averse nation when it comes to investing," she said.

"But with most people now earning record-low returns on their savings, the stock market has become a more appealing option given its tendency to outperform cash in the long run."

"Although Australia is quite conservative with investing compared to other countries, Finder's research shows that we're starting to catch up as more Aussies look beyond cash to maximise their returns."

The ASX was has been very volatile over the last 5 years

If there's one thing we learnt in 2020, it's to expect the unexpected. Just between February and March last year, the ASX collapsed by 33%. This wiped out 8 years' worth of gains in just 28 days.

While the pandemic was bad for most companies, some sectors thrived. Consumer staples like Coles Group Ltd (ASX: COL) and Woolworths Group Ltd (ASX: WOW) thrived. Additionally, so did medical equipment companies like CSL Limited (ASX: CSL) and Ansell Limited (ASX: ANN).

One of the best-performing companies over the last 5 years, according to the Finder report, was Domino's Pizza Enterprises Ltd. (ASX: DMP). Its value grew by 44% over the period. Some funds are still rating Domino's as a buy.

The report also found micro-investing becoming increasingly popular with young Australians. Micro-investing is when someone makes very small investments over time with the expectation it will add up to a sizeable nest egg.

Marc Sidarous has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of CSL Ltd. The Motley Fool Australia owns shares of COLESGROUP DEF SET and Woolworths Limited. The Motley Fool Australia has recommended Ansell Ltd. and Dominos Pizza Enterprises Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Share Market News

Smiling man with phone in wheelchair watching stocks and trends on computer
Share Market News

5 things to watch on the ASX 200 on Friday

The Australian share market looks set to end the week on a positive note.

Read more »

Three miners looking at a tablet.
Broker Notes

Does Macquarie prefer Rio Tinto, Fortescue or BHP shares heading into 2026?

BHP, Rio Tinto, or Fortescue? Macquarie only expects one of the three ASX mining stocks to outperform.

Read more »

Man sitting in a plane seat works on his laptop.
Opinions

Expert reveals 2 ASX stocks to sell — and 1 is a recent IPO

Toby Grimm from Baker Young shares his insights.

Read more »

Happy teen friends jumping in front of a wall.
Share Gainers

Guess which 4 ASX 200 shares are rocking new 52-week highs today!

Investors just sent these four ASX 200 shares to one-year-plus highs.

Read more »

A young woman holds her hand to her mouth in surprise as she reads something on her laptop.
Broker Notes

Why are Platinum shares rocketing 13% today?

This fund manager is getting a lot of love from investors today. Let's find out why.

Read more »

Two happy excited friends in euphoria mood after winning in a bet with a smartphone in hand.
Share Gainers

Why Evolution Mining, Orthocell, Platinum, and Turaco shares are charging higher

These shares are having a better day that most on Thursday.

Read more »

A man sits in despair at his computer with his hands either side of his head, staring into the screen with a pained and anguished look on his face, in a home office setting.
Share Fallers

Why CSL, Imricor, Jumbo, and Netwealth shares are falling today

These shares are under pressure on Thursday. But why?

Read more »

Three happy office workers cheer as they read about good financial news on a laptop.
Broker Notes

Morgans says these ASX stocks can rise 30% to ~50%

Let's see which shares could generate big returns for investors.

Read more »