Pre-2008 financial crisis, quantitative strategy, and high-frequency traders got flack for the mass movements in the market, but now in a post-COVID environment, it’s millennial daytraders who are on the receiving end of pointing fingers.
Armed with daytrading apps like Robinhood, these millennial traders are keen to get in and out of stocks in swift order to make a profit. It’s akin to the tech boom of the late 90s and early 2000s where retail trading spawned a rise in daytraders with an internet connection and a desktop computer.
Nowadays, millennials can profit from trades with a few taps on a mobile device. These young profiteers are eager to swoop in on downtrodden companies affected by the pandemic.
“We see a lot of buying activity of specifically industries that were impacted by the pandemic," said Robinhood co-founder and co-CEO Vladimir Tenev said at the Piper Sandler Global Exchange & FinTech Conference, per a CNN article.
With social distancing and lockdown restrictions, millennial traders in quarantine mode were supplementing their income with day-trading or making it their sole form of income. One of the beneficiaries of this heightened trading activity was the US Global Jets ETF (JETS ) where traders saw a buy-the-dip opportunity in airlines.
“More millennials are working from home more and actively trading,” said Frank Holmes, chief executive officer of JETS issuer U.S. Global Investors.
JETS seeks to track the performance of the U.S. Global Jets Index, which is composed of the exchange-listed common stock (or depository receipts) of U.S. and international passenger airlines, aircraft manufacturers, airports, and terminal services companies across the globe. Airlines have certainly been feeling the pangs of the pandemic given the travel restrictions imposed globally.
Follow the Millennials
Investors looking to capitalize on the latest and greatest in millennial market preferences is the Principal Millennials Index ETF (GENY ). The fund seeks to provide investment results that closely correspond, before expenses, to the performance of the Nasdaq Global Millennial Opportunity Index.
Under normal circumstances, the fund invests at least 80% of its net assets, plus any borrowings for investment purposes, in equity securities of companies that compose the index at the time of purchase. The index uses a quantitative model designed to identify equity securities of companies in the Nasdaq Global Index (the “parent index”) that are impacted by the spending and lifestyle activities of the Millennial generation, which refers to people born from 1980 to the mid-2000s.