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Polling

Momentive study: financial services – inflation, crypto, and robo-advisors

Momentive study: financial services – inflation, crypto, and robo-advisors

Key findings:

  • Inflation fears are dimming the outlook for stock market performance, with 4 in 10 investors expecting a decline in the next 6 months
  • Americans continue to be bullish on Bitcoin, as awareness and expectations for the cryptocurrency trend upward
  • Mobile investing apps are the dominant platforms for younger investors, with Robinhood and Coinbase claiming the highest market share
  • Set-it-and-forget-it convenience is the leading driver of automated investing platform (robo-advisors) adoptions
  • Despite limited confidence in robo-advisor performance, optimism in outperforming human financial advisors is highest among Gen Z and Millennial investors

Stock market outlook dims as concerns over inflation rise

The vast majority (86%) of investors are somewhat or very concerned about inflation over the next six months. This worry is impacting stock performance outlook: nearly 4 in 10 investors expect the stock market to decline in the next 6 months, with those expressing concern about inflation driving the pessimism. Only 14% of those not too concerned or not concerned at all about inflation expect the stock market to deline.

Cryptocurrency and Bitcoin a bright spot for investors, as they remain bullish on future performance

Public awareness and recognition of Bitcoin has risen throughout the year back to 2018 levels, increasing from 51% of U.S. adults having heard or read a lot or some about Bitcoin in February, to 60% in October. Optimism for the cryptocurrency as a mainstay currency is also up, from 43% believing it to be very or somewhat likely for Bitcoin to become a commonly accepted currency within the next 5 years to 51%.

Feb 2021Oct 2021Oct ‘21 vs. Feb ‘21 Δ
How much, if at all, have you heard or read about Bitcoin?A lot / some51%60%+9%
Not much / none at all47%39%-8%
How likely do you think it is that Bitcoin will become a common currency accepted as payment within the next 5 years?Very / somewhat likely43%51%+8%
Not too likely / not likely at all53%45%-8%

Investors are more optimistic about crypto performance than any other type of investment

Although only 24% of investors own crypto, 67% of owners believe that their crypto holdings will be their best-performing investment in the next 6 months, higher than any other type of investment, including real estate (47%), mutual funds (43%), and individual stocks (42%).

Younger investors overwhelmingly prefer to manage investments over self-service mobile apps, with Robinhood and Coinbase leading market share

Among Gen Z and Millennial investors, self-service mobile apps are the most common way of managing investments, compared with using a desktop or agent to execute trades. 

Which of the following do you use to manage your investments?

Robinhood, Fidelity, and Coinbase lead in overall mobile investing app market share among investors overall, but Robinhood and Coinbase have an overwhelming lead among Gen Z and Millennials.

Mobile Investing Apps Used

Most investors are skeptical of automated investing platforms (robo-advisors), but confidence is highest among Gen Z 

Only 5% of investors overall believe robo-advisors always outperform human financial advisors, with more than a third (38%) believing that robo-advisors rarely or never do a better job. Confidence in automated investing platforms in managing portfolios, however, is highest among Gen Z investors: 14% believe they always outperform financial advisors, and only 21% say they rarely or never excel at the job.

How often do you think automated investing platforms (robo-advisors) do a better job at managing portfolios than human financial advisors?

(among investors)

Despite the limited confidence in robo-advisors, most utilize such services more so due to convenience, rather than performance. 50% of those who use robo-advisors do so due to their set-it-and-forget-it investing functions, while only 29% do so due to believing that they can do a better job than relying on themselves or a financial advisor.

Reasons for Using Robo-Advisor

Read more about our polling methodology here