A surprising number of Australians are investing in the stock market as share prices recover at a rapid pace.
Since bottoming out in March, the Australian Securities Exchange has surged 48 per cent.
The benchmark S&P/ASX200 index is just six per cent below the record high reached in February 2020 shortly before the Covid shutdowns.
During the nine months of the coronavirus crisis, Afterpay shares have multiplied by 11 times, soaring from $8.90 to $97.59 as of Friday after peaking above $104 in November.Â
With interest rates at a record-low of just 0.1 per cent, financial comparison group Finder’s personal finance expert Kate Browne said Australians were flocking to the share market.
‘Low savings interest rates have also driven more people into the share market as they seek to make a profitable return on their investments,’ she said.
Where Australians are really investing
Savings account: 44 per centÂ
Not investing: 34 per centÂ
Shares: 27 per cent
Term deposit: 13 per centÂ
Exchange-traded funds: 10 per cent
Superannuation top ups: 8 per centÂ
Foreign exchange: 6 per cent
Gold: 3 per centÂ
Robo advisers: 2 per centÂ
Source: Finder commissioned survey of 1,004 people byÂ Qualtrics. The findings were applied to Australia’s adult population of 19,423,704 people
An estimated 5.2million Australians, or 27 per cent of the adult population, invest in shares, a Finder survey found.
Another 1.9million Australians, or ten per cent of people, put their money in exchange trade funds linked to specific stock market indices or asset classes.
Foreign currencies were embraced by 1.2million people or six per cent of Australians.Â
The Australian dollar meanwhile has climbed to a two-and-a-half year high of 75.30 US as optimism about a coronavirus vaccine helping a global economic recovery boosted demand for the commodities-driven currency.
Gold was the choice of just 582,711 or three per cent of investors, with the base metal a commodity of choice during difficult times.
Robo advisers providing computer algorithms for investment had two per cent of the investment market or 388,474 investors.
Then there were 1.6million Australians, or eight per cent of the population, who opted to top up their superannuation tax free.Â
The Finder survey of 1,004 people found two-thirds or 12.8million Australians had some level of investments other than property.Â
Men were much more likely to be investors with 73 per cent putting their money into growth assets compared with 60 per cent of women.Â
Despite interest rates being at a record low of 0.1 per cent, 44 per cent of respondents, equating to 8.5million people, put their money in saving accounts.
Another 13 per cent or 2.5million chose term deposits.
Since the Reserve Bank of Australia cut interest rates in November by 0.15 percentage points, the major banks have cut their savings rates.
The Commonwealth Bank and NAB are offering just 0.6 per cent interest on their regulator.
Westpac offers rates of just 0.55 per cent compared with 0.45 per cent for ANZ.
A separate online survey of 2,000 people by another financial comparison group Canstar found 30 per cent of Australians dipped into their savings to handle the coronavirus crisis.
Another 11 per cent took on more debt while 15 per cent were able to reduce their debt.Â
For the record, the Australian share market started slightly weaker on Friday with the benchmark S&P/ASX200 down 0.47 per cent to 6,652 points.