As innovation in the online banking sphere has changed the way Canadians handle their money, the Internet has changed the face of investing and has spawned a whole new breed of Canadian investors in the process.
An increasing number of women, young people and those with a myriad of portfolio sizes are starting to get into investing according to a TD study.
“There isn’t a ‘typical’ online investor anymore,” says Calvin MacInnis, president of TD Direct Investing, in a release with the survey. “As technology has evolved, people have gained the tools, information and confidence to help them take control of their investments, and that means we’re seeing a much broader range of clients turning to online investing.”
While men still make up two-thirds of online investors, women are starting to get onboard, opening up their own online brokerage accounts.
Online Research a Must for Investment Picks
According to the survey, 42 per cent of Canadians peruse the Internet when its time to research investment options and 25 per cent actually purchase their investment online – a shift from the traditional advisor-based model. However, McInnis points out that an informed investors doesn’t have to go at it completely alone.
“Even with this growth in using online brokerages, it doesn’t have to be all or nothing,” he adds. “Just over half of the investors we surveyed told us they also work with a financial advisor or an accountant when managing at least part of their investments.”
It’s Still a Steep Learning Curve
Meanwhile, a third of people who don’t invest online find the whole process confusing and say they don’t know enough to make the leap.
“With knowledge comes confidence, so it’s important that self-directed investors – and those interested in getting started – educate themselves on the options available to them and have the tools they need to research and monitor their investments,” says Tony Ierullo, associate vice president – strategy and client management at TD.
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Small Peanuts Welcome
A common concern is that you need Scrooge-McDuck–like wealth in order to be an investor, but there are a variety of online brokerages that will allow small investments.
“You don’t need to be wealthy to invest online,” adds Lerullo “Industry research has also shown that people with under $100,000 in assets are, in fact, the most likely to be planning to open an online brokerage account.”
As the online investor’s toolkit expands, MacInnis expects more Canadians to follow the recent trend.
“Advancements in technology have allowed us to continue innovating to meet the needs of investors as they do more and more transactions online,” says MacInnis. “Now, with mobile trading apps, even more people can invest online wherever and whenever they want.”