(BFM Bourse) – The renewed interest of the French for the equity markets is running out of steam after two years marked by an increase in stock market investments, according to the barometer of the AMF. Only one in four French people say they are interested in the stock market, compared to 29% in 2021.
Between high inflation, the war in Ukraine and an impending recession, the stock markets suffered particularly in 2022. A context that did not fail to cool investors, who opted for caution and that is logical.
Between July and September, the number of retail investors active on the stock market fell to its lowest level since the summer of 2020 at 600,000, reported the Autorité des Marchés Financiers in its latest quarterly survey. This is a third less than in the second quarter.
In this uncertain context marked by equity market volatility, only one in four French people therefore say they are interested in the stock market, compared to 29% in 2021, according to the sixth edition of the savings and investment barometer of the Autorité des financial markets (AMF). However, interest in investments on the financial markets remains high among holders of directly listed shares, at 69%. Seven out of ten French people believe that equity investments are reserved “for people who know enough about it”.
This complexity of stock market investments had already been addressed in another opinion poll. Almost 70% (69%) of French people indicated that they had never been interested in investing in the stock market because it seemed too complicated to themaccording to an Opinionway survey for Scalable Capital.
“Not the right time to invest in stocks”
The Covid-19 pandemic and the resulting stock market crisis provided an excellent opportunity to invest for French people, who had seen their savings greatly inflate, under the effect of successive confinements and associated health restrictions. But with galloping inflation, rising interest rates, supply chain tensions, the zero-Covid-19 policy in China and the conflict in Ukraine, there is a lot of turmoil in the markets this year. A context that has cooled more than one saver to take action.
This is the finding shared by 34% of respondents who believe that “it’s not the right time to invest in stocks” against 26% a year ago. And this pessimism is far from being episodic. After a sharp increase in 2021, intentions to invest in equities in the next 12 months fell by six points and fell back to the level of 2019, at 19%.
This decline is especially true among those over 55, who are more cautious (12%), but also among young people under 25, yet active during the Covid-19 crisis, helped by the offer of “neobrokers”, online brokers who target a younger clientele via minimal brokerage fees.
Their intention to invest in the stock market within 12 months has thus fallen from 37% to 30% in one year. However, the under 25s remain the “most enthusiastic” age category (30%) with 25-34 year olds who are 29% to maintain their intentions to invest at a high level. Those holding shares, however, remain “more optimistic” according to the barometer, 31% of them believing that “it’s a good time to do it”.
A lesser appetite of the French
Sign of this reluctance of stockbrokers, few savers are ready to take risks to have higher returns. Despite the perceived low remuneration of guaranteed savings products, 58% of French people are not ready to accept a little more risk on part of their investments, compared to 49% a year earlier.
“The lesser appetite of the French for investment in equities can be explained, in a more uncertain economic climate which reinforces risk aversion. These developments, but also the importance of fraudulent proposals, underline the importance for the AMF to continue its educational efforts to support savers and give them the keys to investing and diversifying their savings over the long term,” commented Marie-Anne Barbat-Layani, President of the AMF.
Sabrina Sadgui – ©2022 BFM Bourse