Mounting interest in micro investments in South-East Asia – An InsightzClub study

Cryptocurrency token values have broken their respective barriers in the past week as Coinbase raised $89 billion in the first crypto listing on the stock exchange. Other  investment opportunities have also become mainstream among day traders via apps like Robinhood. InsightzClub, a technology-based market research start up, examines key findings from a regional study on micro investment behaviour in SEA.

The majority of the study’s participants, or 78%, reported having at least a moderate understanding of investments. Only 8% were considered to have high understanding. These figures may be explained by the often-complex nature of investing – trading jargon and calculations. Furthermore, in the Singaporean market, 60% of investors had a total investment value of S$10,000

There are a wide range of assets deemed as viable investments. For the purposes of this study real estate was excluded as it is rarely offered on major trading platforms. Stocks were the most selected investment at 66%, while the second was cryptocurrency (50%). This was followed by bonds and unit trusts. Stocks have long been the frontrunner with regards to popularity and accessibility. The relatively small difference between the number of individuals investing in the stock market and cryptocurrency may be an indicator of shifting consumer sentiment. Recent rallies of Bitcoin, Ethereum, and Ripple to all-time highs has also served to induce higher trading volumes. Although an extremely volatile and high-risk market, returns can surpass that of traditional investments many times over. Overall, responses point towards a diversified investing strategy that stabilises risk and raises annual returns.

It is no surprise that 70% of participants selected retirement as the primary motivator for investing. Intelligent investments at a young age can support early retirement goals. Security was the second most selected reason at 48%. Uncertainty has become the hallmark of global economic conditions despite the slow recovery from the COVID-19 pandemic. As predicted, bullish markets have also induced higher investment volumes among SEA consumers.

There are hundreds of trading apps for consumers to choose from. The largest and most popular can hold assets in the billions of dollars. Among the study’s participants, Binance held the majority (32%). It is the largest global cryptocurrency trading platform; hundreds of coins are available and the investment process is relatively easy for newcomers. Surprisingly, Coinbase was not selected by any of the participants, despite its popularity. Luno, another cryptocurrency platform, was used by 24% of participants. It is highly popular in Malaysia and Singapore as it offers quick transfers and deposits from local banks. OctaFX was the third most selected option, with Charles Schwab and WeBull close behind.

With countless platforms to choose from, it is important to understand the reason(s) behind consumer preferences. User experienced ranked first among SEA consumers. As shown in a previous InsightzClub study on usability testing, user experience can determine the success or failure of an app. Recommendation was second at 46%. Many trading apps have referral programs where users can earn commission by inviting a friend to join the platform. In a saturated market, word-of-mouth becomes trusted as it is easier to understand and the source is familiar.

To know more about micro-investments and other consumer based choices and brands, reach out to InsightzClub to know more about our solutions.