The stock market has long been the go-to choice for people looking to invest their money. But that could be about to change as a younger generation enters the scene.
According to a recent survey from Bank of America, individuals aged 21 to 42 with at least $3 million in assets only have 25% of their portfolio invested in stocks. For wealthy investors over age 43, the allocation to equities is much higher at 55%.
This year’s bear market may have something to do with these millennials’ decisions.
“We’ve had a very strong run in the stock market over the last decade and are now living through volatile times. That’s on the front of people’s minds,” says Jeff Busconi, chief operating officer at Bank of America Private Bank, in an interview.
Despite the stock market’s recent bounce, the benchmark S&P 500 Index is still down nearly 18% year to date.
Busconi adds that the younger generation of investors increasingly believes that “a traditional portfolio of stock and bonds is not going to deliver above-average returns over time.”
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