According to a new study, Singaporean millennials and Gen-Z investors remain highly optimistic about investing during the coronavirus pandemic and are confident in their prospects.
Franklin Templeton’s first Next-Gen Investor Survey found that 80 percent of respondents continued to invest in the past 18 months during the Covid-19 crisis, while an even higher 88 percent were thinking about investing in the coming year.
About 37 percent had a monthly personal income of less than S$3,000 (US$2,219), with 31 percent taking home between S$3,000 and S$5,999, 20 percent earning between S$6,000 and S$9,999, and 11 percent collected more than S$10,000 per month.
The online survey examined the investment motives, intentions and aspirations of Singaporean millennials aged 25 to 35 and Gen-Z aged 18 to 24 during the Covid-19 pandemic. There were 502 respondents and the survey was conducted from March 19 to April 6.
A promising finding for the industry is that 83 percent of respondents are regular monthly savers and set aside half of their income specifically for investing, with an average annual investment of just over S$18,000. The majority, 56 percent, also prefer to save through dollar cost averaging, while 24 percent allocate lump sums.
But while these young investors like to save, most also have high expectations of investment returns. More than half expect an annual return of more than 10 percent and a third expect a return of 5-10 percent. Another 15 percent expect a return of 1-5 percent.
The traditional 60 percent equity, 40 percent fixed income asset allocation model is favored by 57 percent of respondents, while 23 percent use asset allocation strategies and 20 percent have no strategy. More than 33 percent of respondents own stocks, and that asset class will remain the most popular option in the next 12 months.