10.23.2019

Investment Funds are Disruption Targets

10.23.2019

Global investment funds poised for disruption as millennials place trust in big techs

  • Calastone research finds that half of all millennials globally would happily purchase investment products from a big technology company such as Google or Apple
  • This figure rises to almost two thirds (63%) for those who already actively invest. For those in the UK, the figure is even higher (71%)
  • Trust in technology itself is also high in the UK, with over half (52%) of millennial investors happy to trust a computer algorithm to invest their money
  • UK millennial investors favour cutting edge technology more than their global counterparts, with more trusting algorithm-based investing than those in Europe, the US and Asia

Calastone. London. 23.10.2019. Research released by Calastone, the largest global fund network, reveals that half of millennials would, if it was offered, purchase investment products through a well-known technology company (e.g. Google, Apple, Microsoft).

Calastone’s study which surveyed more than 3,000 people aged 23-35 across the UK, France, Germany, US, Hong Kong and Australia also found that, for millennials who already actively invest, this figure rises to almost two thirds (63%) globally and to a massive 71% in the UK, which could have significant impact on the $47 trillion funds industry*.

As well as placing trust in big tech, millennial investors in the UK also place a significant degree of trust in technology itself, with 52% stating that they would trust a computer algorithm to invest their money for them. Interestingly, the UK came out on top as the most trusting of algorithm-based investing, with a higher percentage than peers in Europe, the US and Asia.

There is a clear trend that shows as young investors become more sophisticated, their willingness to buy elsewhere and to look at non-traditional players increases, indicating that loyalty to current providers does not necessarily increase over time.

This comes at a time when challenger banks and mobile money management platforms are drawing millennials – and their wallets – from mainstream finance. When it comes to investing, Calastone’s survey highlights that there could be a shift to “big tech” for the global funds sector. As other areas of financial services have reacted to the evolving needs and increasing tech-savviness of younger generations, the investment and funds world must also start to focus on the areas that make big techs’ successful, such as accessibility and user experience.

Whilst the Silicon Valley behemoths have yet to immerse themselves within the investment management world, they have encroached on other areas of financial services. The current regulatory environment may not deter big technology companies from moving into the funds industry given the scale of the opportunity, especially as trust in technology has never been so high.

Andrew Tomlinson, Chief Marketing Officer at Calastone comments:

 

“With the knowledge that there is already a growing level of trust from millennials, who would consider buying investment products from big tech companies, the potential for the technology giants to enter the investment world only increases. Whoever controls access to the investor, controls the market. Fund managers and distributors need to be mindful of this.

 

Many big techs already offer basic financial products and in Asia we’ve already seen Alibaba’s, Ant Financial, entering the investment funds market and in doing so attracting a huge investor base to creating the world’s largest money market fund. Given the opportunity for these companies and the scale of their client base, other markets could follow. The industry should look at what makes these big techs so successful – accessibility with a positive user experience – and learn from that if it is to navigate the coming changes.”

To access Calastone’s full survey, you can follow the link at https://www2.calastone.com/millennialsresearch

 

*Investment Company Factbook

Celebrating women shaping European finance
European Women in Finance Awards deadline is Aug 23
#WomeninFinance #Finance #WIF
Nominate here: https://www.jotform.com/form/250276204100339

As Cboe Data Vantage scales globally, Adam Inzirillo discusses our APAC expansion, plans to launch dedicated cores in Canada and preparation for 24×5 U.S. equities trading, pending regulatory approval – full story in @marketsmedia: https://bit.ly/4kQx3mC

Load More

Related articles

  1. The firm is buying Ceres, an alternatives manager specializing in farmland investments.

  2. Clients’ trades were matched within State Street’s FX Connect execution platform.

  3. "Having a focused area – a center of excellence – is a large part of our narrative."

  4. The SEC approval aligns with the standard practices for similar ETPs.

  5. The largest European asset manager will present a new three-year strategic plan in the fourth quarter.

We're Enhancing Your Experience with Smart Technology

We've updated our Terms & Conditions and Privacy Policy to introduce AI tools that will personalize your content, improve our market analysis, and deliver more relevant insights.These changes take effect on Aug 25, 2025.
Your data remains protected—we're simply using smart technology to serve you better. [Review Full Terms] | [Review Privacy Policy] By continuing to use our services after Aug 25, 2025, you agree to these updates.

Close the CTA