At the young age of 12, Ambrico Ranginui was first introduced to the world of cryptocurrencies. By 16, he had gathered enough funds from birthday money and allowances to begin investing.
Being raised by a single mother, Ranginui developed a strong resolve to succeed financially. “Crypto was incredibly intriguing at that time,” he explained, seeing it as an opportunity to enhance his financial standing.
Ranginui is among the surge of Generation Z investors who are entering the financial markets with more vigor than previous generations, diversifying their investments from secure bonds to cutting-edge AI startups earlier than ever.
A report from the World Economic Forum (WEF) indicates that nearly 30% of individuals born between 1997 and 2012 began investing in early adulthood, even before starting their professional careers. This is a significant increase compared to 15% of millennials and 9% of Generation X.
Cryptocurrency investments taught Ranginui harsh lessons about the unpredictability of financial markets. He experienced a year filled with constant stress and anxiety, which distracted him from enjoying moments with friends or focusing fully on his studies.
Although he prefers not to disclose the amount, Ranginui admitted he lost a significant sum, which led him to cease investing in cryptocurrencies. “There was always a reason to worry,” he stated.
Now 21, Ranginui hasn’t given up on investing altogether. He currently works as an investment analyst at Flatmate Ventures, a venture capital firm that has been around for six months and supports student entrepreneurs. Ranginui has invested his personal funds into sectors like lithium, robotics, and artificial intelligence.
The Guardian interviewed more than a dozen active Generation Z investors from around the globe, discovered through social media and financial forums, to understand their investment strategies and motivations. They pointed to economic uncertainty, a prevalent online investment culture, and historically low barriers to market entry facilitated by technology and AI as their primary reasons for investing.
In New Zealand, Ranginui mentioned the fintech app Sharesies as a significant influence among his peers. “They made investing accessible and trustworthy through their presence in Generation Z spaces online and the wealth of financial educational resources they offered,” he noted.
Generation Z is facing a precarious job market and potentially less economic stability than their parents’ generation. Unemployment rates for individuals aged 22 to 27 are nearly 8%, up from about 6% seven years ago and significantly higher than the current 4.3% across the US. Moreover, rising consumer prices worldwide and reductions in social welfare and employer-sponsored retirement plans are eroding the remaining safety nets.
“This generation is facing diminished financial stability and social safety nets, which shifts the responsibility of financial well-being to the individual,” stated Natalya Guseva, head of the WEF’s financial markets and resilience initiatives. She added that technology has simplified market investing, putting essential information right at one’s fingertips, unlike in previous generations.
Slow and steady
Many are approaching investing with caution.
According to Andy Reed, head of behavioral economics research at Vanguard, a majority of Generation Z prefer long-term investments in low-cost, diversified funds like exchange-traded funds (ETFs). “They’re one of the most cost-aware generations, which will benefit them in the long run,” Reed commented. “They’re learning about investing early and are keen to engage in the market.”
A recent Nasdaq study found that about 75% of Generation Zers hold ETFs in their retirement accounts, compared to just 60% of baby boomers.
Shivana Anand, a 23-year-old software engineer in California, exemplifies this cautious approach. She opened a Roth IRA and began investing in diversified index funds as soon as she started college, supported by a paid internship. Her account automatically deposits a fixed amount each month, allowing her investments to grow passively. “I invest so that money management becomes less stressful. I prefer a slow and steady investment strategy over actively managing a portfolio and worrying about making the wrong choices,” she explained. Anand’s portfolio is now valued in the mid-six-figure range.
Gambling or investing?
A smaller segment of Generation Z is venturing into riskier, more speculative investments like day trading and cryptocurrencies.
“Young people are engaging in high-risk activities like gambling and prediction markets without fully understanding the risks involved,” Reed noted. “Many don’t realize that these risky bets could lead to detrimental outcomes in the long term.”
Minwoo Lim, a 28-year-old founder of the trading app PnL in Dubai, plunged into trading commodities like crude oil after completing his mandatory military service in South Korea six years ago. “Gambling involves risking everything for the potential of significant financial gain, which is akin to trading,” Lim stated.
Statistics indicate that only about 4% of day traders make enough to support themselves, and roughly 10% are profitable, leaving at least 90% who do not succeed. Lim, who grew up in a family of investors and traders, felt it was a natural progression to start trading once he had saved enough money. His background in neuroscience, he claims, provided him with a psychological edge that has made him a profitable trader.
Earlier this year, Lim earned a profit of €1,000 (approximately $1,200) from long positions in crude oil following military actions by the US and Israel in Iran. “Most Generation Z traders might not be profitable because they underestimate the role of human behavior,” he explained. “The key elements are strategy, discipline, and understanding psychology—a trinity.” Lim emphasized that understanding psychology could help traders avoid pitfalls like greed, fear, and cognitive biases that cloud judgment. However, despite his success, Lim does not recommend trading as a career for Generation Z. “Those who invest for the long term will ultimately be more successful than those engaged in trading or cryptocurrencies,” he advised. “Trading requires a significant commitment—it’s not just about making quick money.”
AI advice
Nearly 41% of Generation Z reported they would trust machines to manage their investment portfolios, and many are actively using AI to assist them.
Kelly Noel Mbunui Kameni, a 22-year-old finance student in Kenya, uses AI to verify her investment decisions. She invests in ETFs and the S&P 500. “I can take a picture of my portfolio and ask an AI like ChatGPT for advice on diversification,” she said. “AI is incredibly convenient. If I don’t have time to go through a company’s financial documents, I rely on AI to summarize them for me before making a decision.”
Kameni, who is financing her studies through a scholarship, has invested approximately 50,000 Kenyan shillings (around $400)—enough to start a small business in her country. She plans to continue investing to avoid the need for a corporate job while she pursues her master’s and doctoral degrees. “I’m passionate about learning finance and making my money work for me through investing,” she stated. “I don’t want to spend my life working for an exploitative company, and my investments will fund the lifestyle I desire.”
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