We know it’s easy to be a part-time investor when the economy is strong and stocks are a pretty safe bet. Companies like Robinhood know it too. They have flourished on the idea that the investors who use their app, many of whom are fairly novice traders, can still earn money dabbling a bit in the stock market.
However, when that tide changes, what do novice investors do next? For many Millennial investors, this is the first time they’re experiencing a down economy. It’s easy to wonder if you are prepared to take advantage of this current market. And, if so, what does that even look like?
The challenges we currently face are unlike anything we’ve seen before. That’s why simple categories to describe the kind of market we’re working with - like the traditional bull and bear comparisons - no longer feel like the right fit. When it comes to the stock market, are we looking at a whole new animal?
A transitioning market amidst a new era of DIY investing
The current volatility in the market is hard to predict in both the short and long term, as we haven’t lived through a global pandemic of this scope before. What is for certain, however, is that this is the first time many investors - particularly self-directed - are experiencing this level of disruption.
In previous economic recessions, including 2001 and 2009, financial advisors still served as the main bridge between investors and their portfolios. In recent years that has changed. Robinhood was certainly a catalyst, but other online brokerages made it easy for individuals to manage their own investment activity.
Despite all of this recent market turmoil caused by COVID-19, only 25% of investors are turning to their advisors for help. Presumably, the rest are either laying low or managing their portfolios themselves. With this uncertain market - a first for most self-directed investors - are robo-advisors and algorithms going to deliver the expertise required to invest wisely? If not, where can you turn?
Moving on up
For a long time, the prevailing wisdom was that it was too hard to move your portfolio to another brokerage. Investors bought into the wisdom that patience was the most successful trait to have as a trader and that staying put was the safest bet.
Now, however, moving portfolios is as easy as clicking a mouse. This means that antsy investors who are looking for more than just a trading platform will move, and move quickly if they find a solution that offers more insights, better knowledge and the potential for greater return on their investments.
Trust has always been a critical factor, but now that trust includes reliability. As Robinhood recently discovered, having your platform go down unexpectedly - especially on a volatile trading day - can result in a lawsuit from your customers. Building back that trust is not as easy as issuing an apology or a small credit for select investors.
A new solution for a new era
For these reasons we created All of Us, a different kind of trading platform built on transparency and designed to help you achieve the kind of returns on your investments that financial institutions have traditionally kept for themselves. What does that mean exactly?
Well, it starts with each and every trade. Traditionally the broker gets paid when a trade is executed. At All of Us, we share that payment with you, the investor. Commission-free trading might now be standard in the industry, but no one else is giving you back a portion of the money earned on your trades.
We also enroll each of our members in securities lending and, depending on which stocks are in your portfolio, this acts as an additional source of income. As our platform grows, so does the revenue sharing potential for all of us.
Finally, we’re the only trading platform to take advantage of a social component that encourages sharing in group insights and access. For the first time, you can engage with others in a meaningful way to try and make the most of your money. For those of you that like a little competition, you can rank against your fellow traders and help hone your investment game.
What you can do today
Now is the time to engage in the market. Volatility presents great opportunities, and even novice investors can dip their toes in the water and experience great results.
This is the perfect time to get started with All of Us Financial. You can register for a new account at www.allofusfinancial.com or download the mobile app for iOS or Android directly from our website. The registration process is easy and, once verified, you can transfer funds from your existing portfolio or bank account and start trading!*
*Always remember that investing involves risk. Your investments will fluctuate over time, sometimes going up and sometimes going down.