- Research from eToro and Nasdaq shows US retail investors are driven more by financial independence while UK investors are more focused on retirement
- US retail investors more likely to discuss portfolios with friends, family and kids than UK peers
- US retail investors also more likely to take courses, do research and use AI tools to support their strategy
November 21, 2024 – New research uncovered as part of the eToro’s latest Retail Investor Beat, which was conducted by trading and investment platform eToro with this edition supported through a partnership with Nasdaq, a premier source for financial, economic and alternative datasets, has revealed striking differences between US and UK retail investors when it comes to motivations and openness around the topic.
The study of 2,000 retail investors from both sides of the pond looked to reveal differences in behaviors and goals between retail investors from the two nations.
US investors seek independence, UK investors aim for a better retirement
For Americans, the survey showed there is a clear desire to get the edge in the short to medium term, with US investors more likely to say that achieving financial independence (39% vs 31%) and supplementing income (37% vs 31%) are amongst their main goals. Meanwhile UK investors are far more likely to cite ‘funding retirement’ (42% vs 32%) as a key goal.
| Investment Goal | US Retail Investors | UK Retail Investors |
| Achieve financial independence | 39% | 31% |
| Fund retirement | 32% | 42% |
| Supplement income | 37% | 31% |
Investments more of a taboo topic in UK
The study also revealed differences in how both groups talk about their portfolios with their friends, family members, children, colleagues and strangers. US investors tend to be more open than their UK counterparts to discussing investments, with over 40% discussing a previously taboo subject with their peers.
| I’ve Discussed My Investments With… | US Retail Investors | UK Retail Investors |
| My friends | 41% | 35% |
| My partner | 52% | 56% |
| My family (excluding kids and partner) | 37% | 28% |
| My kids | 22% | 16% |
| My colleagues | 21% | 18% |
| Strangers | 5% | 2% |
US investors more likely to take courses to get the edge
eToro and Nasdaq found that US retail investors are more proactive in building their financial literacy by learning investment knowledge and skills. American retail investors are more likely to have taken an investment course (23% vs 15%), studied strategies of well-known investors (36% vs 28%) and paid for investing tools and resources (22% vs 16%). UK-based retail investors also spend 18 minutes less a week doing research to support their decisions – dedicating an average of 2 hours and 24 minutes to this versus 2 hours and 42 minutes for US investors.
| Actions I’ve Undertaken to Become a Better Investor | US Retail Investors | UK Retail Investors |
| Read books on investing | 37% | 35% |
| Studied strategies of well-known investors | 36% | 28% |
| Taken an investment course | 23% | 15% |
| Paid for tools or resources | 22% | 16% |
There are also differences in the sources of financial news that American and UK retail investors rely upon. UK investors are more likely to trust financial institutions (53% vs 48%) and specialist financial media (44% vs 36%), whereas US investors are more likely to trust friends, family and colleagues (25% vs 19%). US retail investors (17%) are also more likely to leverage AI tools as a part of their overall strategy to research and track various stocks – this falls to 13% amongst UK investors.
| Sources of Financial News I Trust | US Retail Investors | UK Retail Investors |
| Financial institutions and service providers | 48% | 53% |
| Specialist financial media | 36% | 44% |
| National news media | 30% | 33% |
| Friends, family and colleagues | 30% | 25% |
| International news media | 19% | 24% |
| Social media, including influencers | 15% | 13% |
Commenting on the survey findings, Brandon Tepper, Senior Vice President and Global Head of Data, Nasdaq said: “Nasdaq partners with clients around the world to drive more transparency and access to data, which helps retail investors determine how to approach investment strategies based on what is most important to them – whether it be understanding new investment assets, creating long-term wealth management plans, or keeping up with timely information, which can make a material difference. These survey findings show there are great opportunities to further enable economic growth through more data transparency and education in both the US and UK, as well as other growing global retail investor markets.”
eToro UK MD Dan Moczulski added: “The retail investing culture has evolved massively in the UK in recent years and investing is now a topic you’re far more likely to hear in restaurants, pubs and offices than you were a decade ago. However, as the data implies, the UK still trails the US when it comes to people opening up about the topic of investing and sharing knowledge within their social circles.
“Our research shows that amongst those who already invest, Americans put more time and resources into growing their skills and knowledge and they’re also more comfortable talking about the topic. I believe that this gap will close in the coming years, particularly with the right education tools and investment platforms for the local audience in the UK.”
ENDS
Notes to editors
About this data
This data was collected during eToro’s latest Retail Investor Beat, with survey questions on the topics covered in the press release designed by eToro and Nasdaq. There were 1,000 respondents from the UK and 1,000 respondents from the USA. The survey was conducted from 16 August – 2 September 2024 and carried out by research company Opinium. Retail investors were defined as self-directed or advised and had to hold at least one investment product including shares, bonds, funds, investment ISAs or equivalent. They did not need to be eToro users.
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