Three-quarters of young high-risk investors believe they feel competitive while investing in high-risk goods, according to an FCA poll. Consumers are being encouraged to make smarter financial choices as part of the FCA’s new InvestSmart campaign.

The Financial Conduct Authority (FCA) has released fresh data to coincide with the start of its InvestSmart campaign to assist new investors to understand the dangers they may be taking.

Two-thirds (68 percent) of those surveyed (1 000) said they felt a feeling of competition while making an investment, with 76% comparing it to gambling. Investing for the long term was uncommon among those polled.

Survey respondents said that they prefer steady returns over volatile investments, which often need longer investment periods, even though 60% of those polled said they preferred more stable returns.

Social Media And Hype

High-risk investments are becoming more popular thanks to social media and traditional media. Many individuals have been motivated to invest in a certain investment by the media, social media, and other people’s recommendations.

In the wake of the pandemic, more than a million UK investors (six percent) raised their investments or purchased a high-risk investment (April to October 2020).

Concerned about new investors accessing high-risk products that may not be appropriate for them or represent their risk tolerance, the regulator has taken action. According to the FCA’s Financial Lives study, like it’s shown here, the majority of people who have invested believe they are better informed about financial matters than the general public. The absence of investor safety and the dangers to their money were thus unlikely to be understood by these investors

Olympic BMX gold medalist Charlotte Worthington has teamed up with the FCA. When it comes to high-risk activities, Charlotte stresses the necessity for thorough planning. Charlotte became the first woman to win BMX Freestyle gold at the Tokyo Olympics.

The Olympic BMX gold medalist, Charlotte Worthington, said:

“To reach this stage in my career, I’ve put in a lot of time and effort, with highs and lows and hours of training to get the fundamentals correct one trick at a time. Despite the fact that high-risk endeavors may not always go according to plan, preparation and knowledge are the keys to minimizing your risks.

Small risks that don’t always go according to plan are essential to gaining the necessary expertise for a larger project at the correct moment.

The only time I’d take a big risk with investing was after much investigation and preparation.”

For investors, the Financial Conduct Authority (FCA) is now launching InvestSmart, a five-year, £11 million campaign. The promotion is aimed at those who have never invested before, or who are just starting out. In order to reach these investors, the campaign will target them on social media and online. Rather than succumbing to the hype, the campaign encourages investors to examine their tolerance for risk and send them to the FCA’s website for information.

A new strategy is being used to contact people who may be interested in high-risk items so they can better understand the hazards and where to receive help. We’ll be using social media and the internet to reach out to potential investors, ensuring that novices don’t fall for scams. We expect that InvestSmart will boost investor confidence by making it easier to spot fraudsters and take action against them.

Don’t Believe The Hype – Warning From FCA

According to the City watchdog, younger investors are turning to cryptocurrencies, foreign currency trading, and other high-risk items because of social media buzz and the gambling-like excitement of striving to become wealthy fast.

The regulator has now started an £11 million campaign to educate novice investors about the dangers they face.

The warning comes in the aftermath of a flurry of stock market trade tied to so-called “meme stocks,” such as GameStop, which have sparked a rise in cryptocurrencies.

Regulators also discovered that very few of the people polled were willing to stick in the stock market for at least five years, if not more, in order to withstand the expected short-term volatility of the market.

High-risk investments are being taken up by new investors because of social media and press coverage, according to the Financial Conduct Authority (FCA).

Younger investors have been shown to be easily influenced by financial and investing gurus on social media platforms like Instagram and TikTok.

People who purchased forex or cryptocurrency (57 percent and 69%, respectively), wrongly assumed they were regulated by the FCA according to a recent study. The absence of investor protection and the possibility of losing all their money meant they were unlikely to be aware of this.

This effort is designed to assist novice investors avoid being “played,” and it will use the internet and social media to reach them.

This year, there was a discussion of requiring training DVDs or an online exam for anyone interested in investing in higher-risk securities.

YouTube and social media have become more important sources of information for this growing generation of self-investors rather than established media outlets, according to the FCA.

A rising number of people are straddling the line between gambling and investing.