Roughly half of Millennials indicate interest in international investment compared with about one-third of Gen X, Baby Boomer, or senior investors
In mapping out their investments, Millennials are presently more likely than their older cohorts to consider investing internationally, according to a new Spectrem Group demographic study.
Roughly half of Millennials indicate interest in international investment compared with about one-third of Gen X, Baby Boomer, or senior investors, according to The Investment Habits of Millennials (click hereto preview or purchase this report).
Millennial investors can be conflicted about investing. On the one hand, they are young with more of their work and investing lives ahead of them, and so are more amenable to risk. Nearly six-in-ten Millennial investors surveyed by Spectrem Group indicated they are willing to take significant investment risk on at least a portion of their investments to earn a high return.
But they also came of age during America’s worst financial crisis since the Great Depression. Many saw how the economic collapse depleted their parents’ investments.
Adding to their qualms about possible international investment have been recent news stories that have roiled the markets. Affluent investors surveyed last month by Spectrem Group indicated that news about foreign economies was currently having the biggest impact on their economic outlook. When the survey was fielded, eurozone leaders without the participation of the International Monetary Fund, had agreed to a third bailout of Greece that for now will keep Greece in the eurozone. In addition, China, the world’s second biggest economy, announced it had devalued its currency in a bid to stabilize its economy.
But China is the country or region in which the highest percentage of surveyed Millennials said they would be most likely to invest (22 percent), followed by Europe (13 percent).
Twelve percent indicate they are most likely to invest in Brazil and India, while 11 percent are looking toward investing in Japan and the United Kingdom.
Ten percent or less said they are most likely to invest in:
Diversification is among the primary reasons Americans invest internationally, along with growth potential in emerging markets, according to the Securities and Exchange Commission.
The Investing Habits of Millennials finds that risk (along with diversity) is the primary factor these investors consider when selecting an investment. While there is risk in any type of investment, international investing poses unique risk challenges to the investor, including changes in currency exchange rates, volatility in foreign markets and political, economic and social events.
Donald Liebenson writes news and features for Millionaire Corner. He has been published in the Chicago Tribune, The Chicago Sun-Times, The Los Angeles Times, Fiscal Times, Entertainment Weekly, Huffington Post, and other outlets. He has also served as a marketing writer for Chicago-based Questar Entertainment and distributor Baker & Taylor.
A graduate of the University of Southern California, he is married with a college-age son. He also writes extensively about entertainment.