Market commentary by eToro analyst for Romania, Bogdan Maioreanu
Romanians continue to be more interested in crypto than in other assets, according to a survey from the eToro online investment platform.
Thus, 28% of the respondents said that they have cryptoassets in their portfolio, while 19% are investing in precious metals – Gold and Silver. The poll also shows that 18% invest in shares, while 4% of the Romanian prefer to invest in art, collectibles or expensive wines.
The poll also shows that retail investment has fully taken hold in Romania, with the pandemic making 58% of respondents more likely to invest. Online platforms have become Romanians’ preferred way of investing, with 37% indicating they invest through an online platform, 26% invest through a bank, 12% invest through a broker and 9% invest through a financial advisor. This is clearly showing that retail investors feel empowered by the easy, direct access to investment vehicles on online platforms. Among Romanians who invest in stocks, 33% invest in Romanian ones, while 28% invest in international stocks, with 22% doing both.
In a report of the Bank for International Settlements it is mentioned that “small traders seem to be often attracted by the speculative nature of single stocks, rather than by the diversification benefits of indices. Consistent with such preferences gaining in importance, share turnover for exchange-traded funds (ETFs) tracking the S&P 500 has flattened over the past four years, while that for the S&P 500’s individual constituents has been on an upward trend over the same period, pointing to 2017 as the possible start year of retail investors’ rising influence”. Romanian investors are not different from their American peers being excited by interesting assets like crypto and tech shares but only 4.8% declaring to have ETFs in their portfolio and less than 12% investing in other types of investment funds.
A third of respondents said they did not have any investments. When asked why, less than 5% mentioned that it is too risky, the vast majority – 66% of those – mentioning the lack of money. According to the survey, 80% of the respondents said they were making less than 5000 RON net per month, with 11% earning between 5001 and 10000 ron net and only 1.6% earning more than 15000 RON net per month.
Amid rising inflation, notably only a few respondents (3%) declared that they do not invest because they prefer to keep their money in a bank.
Other important obstacles to investing, mentioned by 47% of respondents, are the lack of understanding of the field and not knowing how to start. When asked about where they would search for information about investing, almost half of the respondents mentioned online, a course or specialty books while 9% mentioned social media. Family and friends are not so popular as information sources with only 8% of the respondents mentioning them.
The survey was carried out on behalf of eToro by Attest at the end of October 2021, online, on 1000 randomly chosen Romanians with ages between 18 and 55 years.
* Bogdan Maioreanu, eToro analyst and markets commentator, has over 20 years of experience in financial services and investments and a strong background in journalism. He held different Corporate Banking management positions in both Raiffeisen Bank and OTP Bank, before moving to business consultancy roles working for IBM Romania among others. Bogdan is an Executive MBA from Asebuss and Washington University.
**eToro is a multi-asset investment platform that empowers people to grow their knowledge and wealth as part of a global community of successful investors. eToro was founded in 2007 with the vision of opening up the global markets so that everyone can trade and invest in a simple and transparent way. Today, eToro is a global community of more than 23 million registered users who share their investment strategies; and anyone can follow the approaches of those who have been the most successful. Due to the simplicity of the platform users can easily buy, hold and sell assets, monitor their portfolio in real time, and transact whenever they want.