Latinx Investors Are Part of The New Wall Street
Gretchen Howard, Chief Operating Officer
Robinhood was created for a new generation of younger and more diverse investors. We want to build a platform that welcomes everyone, especially given the role systemic racism has played in excluding people of color from participating in our financial system.
To achieve our mission, we’ve been focused on better understanding our diverse customer base, and how they use Robinhood. We see more than double the industry average of Latinx and Black investors on our platform, and we know that new investors in 2020 were younger and more diverse than experienced investors. In honor of Hispanic Heritage Month, we worked with Morning Consult to survey overall Latinx investors and learn more about this community’s investment barriers and habits. We found that Latinx investors are playing an increasingly important role in our markets, and they’re embracing new technologies along the way.
Here’s what we learned:
- Newer to investing: 67% of Latinx investors began investing 5 years ago or less, compared to 43% of total retail investors. That suggests that Latinx investors are playing an important role in the recent retail investing surge—and that recent innovations, like commission-free investing with no account minimums, could be paving the way for a more diverse investing base.
- Crypto believers: 61% of Latinx investors said they invest in crypto, compared to 39% of the general population, and three-quarters agreed that it’s the “currency of the future.” If they had a spare $100, 73% Latinx investors were more likely to invest it compared to 50% of the general population, and nearly twice as likely to use it to buy crypto (41% vs. 24%). 51% of Latinx investors who invest in crypto do so as a way to achieve long-term goals.
- Mobile-first: Most (51%) Latinx retail investors who trade individual stocks use a smartphone app to make trades, compared to 35% of total investors surveyed.
- Intentional with investing goals: Like the total population, (95%) of Latinx retail investors have specific financial goals for the money they invest including big, long-term goals like saving for retirement.
- Values-focused: Four in five (81%) Latinx retail investors who invest in individual stocks make investment decisions based on the company’s mission or values compared with (74%) of total retail investors. The Latinx retail investor can serve as a force for good in our capital markets.
This data sheds light on a growing community of investors that’s historically been underserved. Beyond the research, we know there’s more work to do to build a democratized financial system. We recently partnered with the National Bankers Association (NBA), an association representing minority-owned banks, to help close the growing racial wealth gap in America. We also committed to Operation Hope’s Investors’ Bill of Rights, a call-to-action for the rest of the financial services industry to build better protections for retail investors.
At home, our recruiting team has also partnered with Latinas in Tech — the largest network of Latinas working across the technology sector. Additionally, Latinhood, our employee resource group dedicated to raising awareness of the Latinx community, recently teamed up with Robinhood Snacks to feature Latinx SnackFacts—data at the intersection of culture, business, and economy.
It’s our honor to serve a growing and diverse community of Latinx investors, and we’ll keep working to reduce barriers—economic, educational, and emotional—so we can democratize finance for all.
*The Retail Investors poll was conducted online between August 26 – August 29, 2021 among a sample of 2200 Adults. The data is weighted to reflect the American Retail Investor population. Results from the full sample have a margin of error of +/- 2%.
*The Latinx Retail Investors poll was conducted online between August 26 – September 6 among a sample of 500 Adults. The data is weighted to reflect the Latinx Retail Investor population. Results from the full sample have a margin of error of +/- 4%.