Young Men Are Pouring Money Into Risky Assets Like Crypto and Meme Stocks
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What is the main topic discussed in this episode?
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Here's your Money Briefing for Tuesday, December 10th. I'm J.R. Whalen for The Wall Street Journal.
Which risky assets are young men pouring money into in 2024?
Financial professionals often advise against investments in assets like cryptocurrency and so-called meme stocks because of the potential for significant losses. That hasn't stopped a disproportionate number of younger men from pouring money into that end of the market.
There are a lot of different factors driving this, but the main reason that I heard was that taking a big leap of faith in their financial strategy feels like the only way that they can really have a chance at the life that they want, whether that's retiring comfortably or buying a home.
Is the reward outpacing the risk? We'll talk to Wall Street Journal reporter Katherine Hamilton after the break.
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Many young men are making risky investments and are enjoying sizable returns for now. Wall Street Journal reporter Katherine Hamilton joins me.
What age groups and gender differences show higher ownership of crypto and meme stocks?
Katherine, what ages of men are we talking about?
Broadly speaking, we're talking about men under 40 years old, so mostly men in their 20s and 30s, but sometimes even younger.
What types of investments are they putting their money into?
Primarily cryptocurrency, gold, betting of varying kinds, and also meme stocks.
How does the percentage of men invested in these risky assets compare to other age groups and compare to women?
Generally speaking, men make up a very slight majority of overall investments. But for these particular investments, they're holding a much greater share. So for cryptocurrency, about 42% of men ages 18 to 29 hold crypto versus 17% of women their age. And almost 11% of men between 25 and 34 own both gold and silver compared to about 6.5% of the total U.S. population. And then for betting on this most recent political election, about 85% of those bettors were male and about half of them were under 30. And that's from Kalshi, which is a political betting platform.
Why are men in particular willing to risk so much money in these investments?
There are a lot of different factors driving this, but the main reason that I heard from the folks that I spoke to was that taking a big leap of faith in their financial strategy feels like the only way that they can really have a chance at the life that they want, whether that's retiring comfortably or buying a home.
Why is this happening now?
Again, there's a lot of different factors. Men in particular, young men are falling behind in terms of higher education, involvement in the labor force. And so reaching those traditional milestones is becoming more of a challenge.
Why are younger men willing to risk large portions of their savings on speculative investments?
When did we see this trend begin of more men in the market on the riskier side?
It's been a gradual increase, you could say, over the last couple of decades. Again, cryptocurrency is relatively new. It came in around 2010 and has been rising in popularity since then. The onset of the internet has also really fueled this because a lot of young men educate themselves about investing online. And there are a lot of online communities specifically dedicated to riskier investing.
Where online are they doing the research?
YouTube and Reddit are the ones we hear about a lot, especially, for example, during the meme stock craze in 2021. Those two platforms were really big in terms of communities that came together, talked about the meme stock GameStop specifically, and helped create that run-up that we saw.
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Chapters
7 chapters
1
What is the main topic discussed in this episode?
0:00–0:41
2
Which risky assets are young men pouring money into in 2024?
0:41–2:09
3
What age groups and gender differences show higher ownership of crypto and meme stocks?
2:09–3:55
4
Why are younger men willing to risk large portions of their savings on speculative investments?
3:55–5:16
5
How have the internet and online communities like YouTube and Reddit driven risky investing?
5:16–6:52
6
What returns have hypothetical portfolios of crypto, gold and meme stocks produced in 2024?
6:52–8:22
7
How do masculinity attitudes and feeling like one is falling short predict risky investing behavior?
8:22–9:09
Speakers
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