The number of Belgian investors trading on the stock market increased significantly during the coronavirus crisis and the ensuing lockdowns, according to a study by the Financial Services and Markets Authority (FSMA), the financial regulatory agency in Belgium.
During the past three years, 830,000 Belgians traded on the stock market, but in the first three months of 2021, the number of unique investors more than doubled relative to the first quarter of 2019.
“I am personally pleased that there is interest in the Brussels Stock Exchange, which is a regulated market,” FSMA Chairman Jean-Paul Servais said on Monday during a webinar.
“I prefer that to seeing people invest in crypto-currencies.”
The number of new investors at the beginning of 2021 was 50% higher than at the beginning of 2019, the report reads.
Between the beginning of 2018 and the end of March 2021, 330,000 separate investors invested in BEL20 shares, the flagship index of the Brussels Stock Exchange.
“During the first lockdown, the number of Belgians who traded in BEL20 shares increased fivefold compared to the period before the crisis,” said the report.
“Moreover, young and infrequent investors were much more active during the lockdown period.”
Taking all financial instruments (such as shares, bonds, options) together, the total number of separate Belgian retail investors amounted to 830,000, or 10% of adults in Belgium, of whom approximately 550,000 traded shares.
The lockdowns, especially the first one in the spring of 2020, led many Belgians to take an interest in the stock market, with 45,000 new investors.
The start of 2021 was also marked by the arrival of 26,000 new retail investors. Compared to the beginning of 2019, that was a considerable increase of more than 50%.
Since the coronavirus crisis, the volume traded in BEL20 shares has also increased significantly – over the entire period 2018-2021, this volume averaged €625 million per month, but between mid-February 2020 and the end of March 2021, it averaged €933 million per month.
FSMA also noted that new investors remain active in the stock market and behave in the same way as other investors.
But the arrival of new retail investors, especially young people, is not without risks, the FSMA chairman said, noting that new investors seem to have a tendency to invest more in riskier products.
The stock market watchdog carried out an in-depth analysis of stock market transactions carried out by or for Belgian retail investors between January 2018 and March 2021, allowing for pre- and post-coronavirus comparisons.
Those investors accounted for 10% of total transactions, with the rest being carried out by professional investors, according to Servais, for whom “the interest of Belgians, of Mr. and Mrs. Everyman, is growing extremely strongly.”