Social media influencers are boasting less of an impact on retail investors’ decision-making in the UK as market uncertainty has grown, research has found.
These so-called finfluencers, who give financial advice on social media, have become a declining source of information since the end of 2021, Charles Schwab found in a report.
Younger investors, in particular, have moved toward more traditional sources of information, such as investment publications or financial advisors.
Some 37% of Gen Z respondents to Charles Schwab’s research, who are aged up to 27, cited finfluencers as a source of information, against 50% in late 2021, marking a 13% decline.
Millennials, aged between 28 and 43, have also taken to relying on finfluencers less, with 10% fewer citing these as sources than in 2021, at 42%.
“[These groups] have historically shown more appetite in taking investment advice from finfluencers,” the investment firm noted.
Charles Schwab added a similar trend had been seen with celebrities who discuss investments.
Some 32% and 35% of Millennial and Gen Z respondents highlighted such celebrities as a source of their investment advice respectively, down on 51% and 45% previously.
“The current macroeconomic climate continues to shape the attitudes and behaviours of retail investors in the UK,” director Richard Flynn said.
“Since we began this study at the end of 2021, domestic and international markets have experienced varying levels of volatility and uncertainty.”
The investment firm said 81% of retail investors agreed seeking expert advice was important when considering trading strategies, while six in 10 said they did this before making changes to portfolios.
“It is [...] reassuring to see a rising - and notable - number of investors proactively seeking professional advice in order to make the most of their investments,” Flynn added.