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Traders still making profits despite volatile markets says research

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Nearly two out of five (39%) of the UK’s army of retail share traders say they’ve made money buying and selling shares in the past year despite market volatility, new research from ETP provider GraniteShares shows.

The numbers claiming to have made money outweigh those who have lost out – 34% of share traders admit to losing money on their trading while 14% estimate they’ve broken even and 13% don’t know whether they are up or down on the year. The research was the result of a study conducted by independent research company Consumer Intelligence among 1,078 UK adults in November 2022 using an online methodology.

Just one in 12 (8%) of retail share traders claim they’ve made big profits with 31% admitting their returns are small, the nationwide study found. The research for GraniteShares found the average spending on buying shares in the past year is estimated at more than £2,600. Around a quarter (24%) of retail traders however say they spent more than £5,000 in the past year.

GraniteShares research shows nearly one in three (32%) of UK adults currently buy or own shares. Around 42% of men say they do compared with 23% of women while 18 to 25-year-olds are the most likely to buy or own shares at 37% compared with other age groups.

Recession is not frightening active traders

Traders don’t seem to be put off by the fact that there is an increasing prospect of a global recession. According to a survey run by Capital.com, the high-growth global trading platform, 63% of its retail traders expect global markets to go into recession in 2023. When asked how severe they expect the recession to be in 2023, 40% of respondents said global markets would experience a multi-year recession while 47% expect it to be short and mild. Interestingly, 25% of traders did not expect global markets to be in recession this year while 12% remained unsure of the outlook.


The Capital.com survey also revealed how retail traders would be positioning their portfolios in the next 6 to 12 months with a close split between those who said they would not change their strategy (31%) and those who said they would take on more short positions (23%). Conversely, 21% of those polled said they would move into cash savings and investments while 16% opted for more exposure to gold in 2023.

“It’s interesting to note how more traders are looking at shorting strategies as markets turn more uncertain,” noted Daniela Hathorn, a maket analyst with Capital.com. “Contracts for Difference (CFD) trading enables traders to take a short position in many markets, meaning they are able to position themselves accordingly even when their views are more pessimistic or they believe an asset is overpriced. That said, as always, traders should be cautious when placing leveraged positions and should implement appropriate risk management into their strategies, like the use of stop losses,” noted Hathorn.

Most UK retail traders are in it for the long run

Most retail share traders have been buying and selling for five years or more in contrast to claims that the COVID-19 lockdown triggered a rise in share trading. Around 69% say they first started five years or more ago. Just one in 12 (8%) have started trading in the past year.

Will Rhind, Founder and CEO at GraniteShares said: “The past year has seen high levels of volatility with a swing of nearly 1,000 points from the FTSE’s high to its low and markets worldwide have been similar.”

Rhind thinks it is quite interesting to see that more retail share traders seem to have made money than lost it in the past year, and that there are a large number of people who have been trading for a long time as the research shows. “It is also the case that there is a growing number of sophisticated investors in the UK who see opportunities from market volatility, which is reflected in the demand for products such as short and long ETPs which provide the flexibility needed to help navigate volatile market swings on both the long and short sides.”

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This article does not constitute investment advice. Do your own research or consult a professional advisor.

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