BNY: Young Investors' Lack of 2008 Crisis Experience Drives Higher Risk Appetite
Alicia Levine, Head of Investment Strategy and Equities at BNY Wealth, argues that younger investors exhibit a higher appetite for risk because they were children or had minimal assets during the 2008 global financial crisis. Unlike older generations scarred by the Great Recession, today’s 30-to-40-year-olds primarily know market strategies like 'buying the dip,' having witnessed rapid recoveries from recent disruptions such as the 2020 pandemic crash and 2022 inflation spikes without experiencing prolonged recessions. This resilience is further influenced by economic pressures, including a challenging job market and housing unaffordability, which drive early and active investment behavior. In response to this demographic shift, BNY Wealth is expanding its service offerings beyond traditional diversified portfolios. The firm is introducing alternative asset classes, including infrastructure, hard assets, secondaries, distressed assets, and credit, to cater to clients seeking aggressive growth. While digital assets are under consideration, they face regulatory hurdles. This strategic adjustment aims to align with the distinct financial behaviors and long-term wealth-building goals of a generation that did not directly experience the trauma of the 2008 market collapse.
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BNY: Young Investors' Lack of 2008 Crisis Experience Drives Higher Risk Appetite
Alicia Levine, Head of Investment Strategy and Equities at BNY Wealth, argues that younger investors exhibit a higher appetite for risk because they were children or had minimal assets during the 2008 global financial crisis. Unlike older generations scarred by the Great Recession, today’s 30-to-40-year-olds primarily know market strategies like 'buying the dip,' having witnessed rapid recoveries from recent disruptions such as the 2020 pandemic crash and 2022 inflation spikes without experiencing prolonged recessions. This resilience is further influenced by economic pressures, including a challenging job market and housing unaffordability, which drive early and active investment behavior. In response to this demographic shift, BNY Wealth is expanding its service offerings beyond traditional diversified portfolios. The firm is introducing alternative asset classes, including infrastructure, hard assets, secondaries, distressed assets, and credit, to cater to clients seeking aggressive growth. While digital assets are under consideration, they face regulatory hurdles. This strategic adjustment aims to align with the distinct financial behaviors and long-term wealth-building goals of a generation that did not directly experience the trauma of the 2008 market collapse.
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