An overwhelming majority of active traders (92%) feel knowledgeable about exchange traded funds and confident that they have the resources to trade ETFs with intelligence while mitigating risk, according to a new Direxion Trader Sentiment Survey conducted by the Harris Poll.
Nearly half of survey respondents (49%) held ETFs in their portfolios at the time of the survey, with 80% — regardless of whether or not they traded ETFs — stating that they felt knowledgeable about ETFs. When it comes to making trading decisions, active traders were monitoring traditional media (92%) and social media (77%) for important developments. Most active traders (82%) were confident when making informed decisions about trading ETFs.
“It’s a positive sign that ETFs have become integral to so many active traders’ strategies, and that so many have done their homework to understand these investment vehicles,” said Direxion chief marketing officer Andy O’Rourke before adding: “There’s still work to be done across the industry to educate an even broader swath of traders in a diverse marketplace.”
Of the 500 active traders surveyed, 89% believed they could generate returns trading in both bull and bear markets. However, Gen Z/Millennial traders proved more likely than Gen X or Boomers/Silent Generation traders to expect that it would take 12 months or less for the S&P 500 index to return to all-time highs, an overwhelmingly positive outlook on the S&P 500 over the next year.
“Many active traders are turning to ETFs and receiving liquidity, efficiency, and diversification benefits,” said VettaFi’s head of research Todd Rosenbluth. “While many advisors take a longer-term approach to investing, they benefit from a strong ETF ecosystem that ensures that when they want to occasionally buy or sell there’s someone on the other side of that trade and lowering the cost of ownership.”
Direxion managing director and head of sales Ed Egilinsky said: “These results confirm active traders in 2022 are in a better position than previous generations to take advantage of opportunities,” before adding: “Active trading used to be more heavily skewed to older generations due to the requirement of accumulated wealth. There’s more active trading across a broader demographic now since markets are more accessible. That access necessitates education and validates our commitment to continually educating active traders.”
The survey was conducted in October 2022 and directed towards U.S.-based active traders who made their own trading decisions, traded within their accounts at least monthly, and had at least $25,000 in investible assets.
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