Zerodha CEO Nithin Kamath in a recent post on unknown (formerly Twitter), said that the Indian stock market has become considerably younger after the COVID-19 pandemic.
“One good thing about all the post-pandemic glut in the stock market is that the Indian stock market has become much younger,” he said.
While he acknowledged that many young investors are making common mistakes, he emphasized that early financial missteps can be valuable learning experiences.
It emphasizes that while reading and learning about the market is crucial, true financial literacy often comes from making mistakes and learning from them, particularly when young investors have less to lose compared to later stages in life, when financial responsibilities They are older.
“It’s better to make all the mistakes when you are young and have very little to lose than later in life when you have more money and responsibilities,” Kamath said.
Nithin Kamath shares post about X
The good thing about all the post-pandemic glut in the stock market is that the Indian stock market has become much younger.
Of course, many of these young investors are doing a lot of things they shouldn’t be doing. But it’s better that they make all the mistakes when… pic.twitter.com/WJ3FvQnfKY
-Nithin Kamath (@Nithin0dha) October 15, 2024
Increase in young investors
Nithin Kamath also shared a link to an internal blog post by Zerodha that highlighted that Generation Z investors, generally described as those born between 1997 and 2012, began saving and investing at age 19, according to the survey. While baby boomers (Americans born between 1946 and 1964) did not start until age 35, on average.
The blog post, which Kamath shared, also shows that the growing participation of young investors is not just an American phenomenon but is also happening in India.
It wasn’t just India; the blog post highlighted that all major markets added more users during the 2-3 years of the pandemic than in the entire previous decade. A significant portion of these new investors were under 25 years old.
He further noted that advancements in investment platforms, facilitated by Aadhaar, Digilocker and UPI, combined with the widespread use of smartphones and affordable mobile data, have made investment more accessible than ever.
However, the enthusiasm of young investors led to risky behavior, including a surge in penny stock trading, options speculation, and a frenzy around cryptocurrencies and NFTs.
“The period between 2020 and 2022 ranks among the five craziest market phases in the 400-year history of modern financial markets,” the post said.
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