DALLAS, April 21, 2020 /PRNewswire/ -- Apex Clearing, the custody and clearing engine powering the future of wealth management, has released its Q1 2020 Apex Millennial 100 report, an analysis of the top 100 stocks owned by millennial investors using Apex partner applications as of March 31, 2020. The report analyzed more than 950,000 investment accounts owned by US-based investors with an average age of 31 years and four months.
During the first quarter of 2020, millennials came face to face with the first major economic crisis of their adult lives, suddenly finding themselves navigating extraordinary volatility resulting from the uncertainty of the COVID-19 pandemic. The Q1 Apex Next Investor Outlook [https://go.apexclearing.com/apex-next-investor-outlook-q12020-infographic] provides insight into how these nearly one million millennial investors reacted and identifies notable patterns in their investing behavior during a time of crisis.
"Despite the intimidating market swings over the past quarter, millennials continue to show an incredible amount of faith in the stocks that have been a key part of their investment strategy since we began this analysis," said Bill Capuzzi, CEO of Apex Clearing. "Millennials' top 10 holdings – most of which are dominated by large technology focused companies – were unchanged from the last quarter of 2019. Following a buy-and-hold approach for their core investments has helped them navigate the volatility in the market and their lives in the wake of COVID-19, even as they boldly pursue opportunistic investments in new areas."
Some trending stock themes in the Q1 Apex Millennial 100 include:
- Drawing strength from their largest positions: Millennials' top 10 holdings were unchanged from the previous quarter and continued to represent a large portion of the Apex Millennial 100 (52%). On average, stocks in the top 10 were down approximately 5% for the quarter—dramatically outperforming broader market measures, such as the S&P 500 Index, which declined roughly 20%. Shares of Tesla (#3) advanced 25%, Amazon (#2) was up 6% and Netflix (#8) posted a 16% gain.
- Turning bullish on travel stocks: The COVID-19-driven economic slowdown is deeply impacting the $8 trillion global travel industry. As shelter-in-place enforcements and other lockdown measures carry deeper into the spring and summer, the airline industry is poised to lose a staggering amount, estimated at more than $250 billion. Millennial investors, however, seem to be bullish on the longer-term prospects for airlines, taking advantage of buying major airlines on the dip. Delta and United, which were previously unranked, claimed the #21 and #57 spots respectively, while, American Airlines climbed 30 spots to #46 and Southwest moved up 10 positions to #88.
The COVID-19 outbreak is also wreaking havoc on the cruise industry—another area where millennials made significant moves. Carnival (#38), Royal Caribbean (#54) and Norwegian (#71) were all new additions to the Apex Millennial 100 last quarter. In fact, cruise stocks saw the highest percentage increase in number of positions and quantity of shares held of any industry.
- Showing support for healthcare companies: The Apex Millennial 100 revealed support for healthcare companies that are closely linked to treatments and other services related to COVID-19. One approach to treatment involves antiviral drugs, dozens of which are in various stages of development. A drug from Gilead is currently furthest along—and millennials took note, with the company making a big quarter-over-quarter jump from #91 to #45.
"Our Q1 2020 report helps validate that millennial investors are patient and strategic when they find themselves in bear market territory," said Hannah Shaw Grove, Chief Marketing Officer of Apex Clearing. "The data shows they're going long in the areas where they have conviction, and taking positions in the companies they believe will benefit from the pandemic – like biotech and remote collaboration tools – as well as those that have taken a big hit in the short-term but may be poised to rebound – like airlines and cruise companies."
To see the complete list of Millennial 100 stocks, click here [https://go.apexclearing.com/apex-next-investor-outlook-q12020-top100].
Cross-Generational COVID-19 Market Volatility Trends
"Beyond our Millennial 100 data, we saw investors of all ages flock to digital platforms to take advantage of the volatility, which drove a huge spike in new account openings," added Capuzzi. "Being one of the first companies to digitize the activities associated with securities clearing and custody, our partners depend on our technology to deliver better experiences to their investors when they need it the most."
An analysis of more than 7.5 million investor accounts that custody with Apex Clearing as of March 31, 2020 spanning Millennial, Generation X and Baby Boomers for self-directed and robo advised accounts identified the following market volatility trends stemming from the COVID-19 outbreak:
- Massive spike in account openings: There was an increase in new accounts at a record rate in March 2020 across each generation. This spike in activity was facilitated by Apex's award-winning family of APIs that makes it simple for investors to open and fund eligible accounts in minutes, not hours or days. New self-directed accounts were up 83% MoM and 308% over the 2019 monthly average, while new robo accounts were up 29% MoM and 279% over the 2019 monthly average.
- Online investors actively trading in volatility: Trades per account were up across the board with self-directed investors driving the majority of the increase. Apex processed more than 27 million trades in self-directed accounts in March (a more than 100% increase over the 2019 monthly average). The number of trades in Millennial accounts skyrocketed in March, increasing 55.5% MoM which was ahead of both Gen X (45.9% increase) and Baby Boomers (31.7% increase), indicating that younger generations are reacting more strongly to the market volatility.
- Higher cash balances: March 2020 saw a pronounced increase in cash positions across generational segments. As of March 31, 2020, GenX had the highest percentage allocated to cash at 14.6%, followed by Boomers with 12.4% and Millennials at 4.8%.
About Apex Clearing Corporation
Apex Clearing is a custody and clearing engine that's powering the future of digital wealth management. Our proprietary enterprise-grade technology delivers speed, efficiency, and flexibility to firms ranging from innovative start-ups to blue-chip brands focused on transformation to capture a new generation of investors. We help our clients provide the seamless digital experiences today's consumers expect with the throughput and scalability needed by fast-growing, high-volume financial services businesses. Founded in 2012, Apex Clearing is registered with the SEC, a member of FINRA and a participant in SIPC.
For more information, visit the Apex Clearing website, and follow the company on Instagram, LinkedIn, and Twitter.
JConnelly for Apex Clearing
SOURCE Apex Clearing