ETFs are continuing to be a popular choice for Aussie investors as the cost of living skyrockets and interest rates rise.
Investing platform Superhero has had more than $2 billion worth of ETF trades executed on its platform since late 2020, with Millennials accounting for more than half of the trading (58 per cent).
Gen X investors make up the next biggest slice (23 per cent), followed by Gen Z (14 per cent) and Baby Boomers (5 per cent).
Also read: Hottest 100: The most popular stocks of 2022
Superhero CEO John Winters said ETFs had become the “go-to” for investors for a number of reasons.
“It gives you instant diversification, across either a sector or entire index. It also strips out a whole bunch of costs and decision-making when it comes to picking and choosing individual shares,” Winters told Yahoo Finance.
“People can go out and buy a portfolio reasonably easily and set up a diversified portfolio at a low cost.”
For instance, Superhero currently requires a minimum investment of just $100 to get started. ETF-specific trading platforms CommSec Pocket and Sharesies also have low barriers to entry, requiring $50 and no minimum investment amount, respectively.
BetaShares NASDAQ 100 (ASX: NDQ) - which invests in companies like Apple, Amazon and Google - has been Superhero’s most popular ETF by trade volume, while Vanguard Australian Shares (ASX: VAS) was the top by dollar value.
“The younger generation, Gen Z and Millennials, are looking for exposure to investments where they have an affiliation to the underlying companies,” Winter said.
“Older generations like Boomers have a different risk profile and different time horizon and we’re seeing them look for investments that might give a lower return, but a more certain return.”
Baby Boomers were more likely to invest in fixed income ETFs that invest in bonds, Superhero found, while Gen Z investors were more likely to invest in Environmental, Social and Governance (ESG) ETFs.
Millennials favoured future tech ETFs, while Gen X looked for themes around banks and energy more than other generations.
Most popular ETFs
The top 10 most-traded Australian ETFs on Superhero in the first quarter of this year were:
BetaShares Nasdaq 100 (NDQ)
Vanguard Australian Shares (VAS)
BetaShares Asian Technology Tigers (ASIA)
Vanguard Diversified High Growth (VDHG)
BetaShares Global Cybersecurity (HACK)
BetaShares Sustainability Leaders (ETHI)
Vanguard Diversified Balanced (VDBA)
Global X Battery Tech & Lithium (ACDC)
Vanguard MSCI Index International (VGS)
Global X Fang+ (FANG)
The top 10 most-traded US ETFs over the same period were:
ProShares UltraPro QQQ (TQQQ)
Vanguard S&P 500 (VOO)
ProShares UltraPro Short QQQ (SQQQ)
Direxion Daily Semiconductor Bull 3x Leveraged (SOXL)
Global X Autonomous and Electric Vehicles ETF (DRIV)
ARK Innovation ETF (ARKK)
Direxion Daily S&P BioTech Bull 3x Shares (LABU)
ProShares Ultra VIX Short Term Futures (UVXY)
Vanguard Total Stock Market Index (VTI)
SPDR S&P 500 ETF Trust (SPY)