66% of Young Investors Take Less Than One Day to Make Investment Decisions, FCA Research Reveals

The latest research by the UK Financial Conduct Authority (FCA) reveals that young investors are making snap investment decisions without thoroughly assessing the long-term suitability of the products they choose.

The survey, which questioned 2,000 UK investors aged 18 to 40, found that two-thirds (66%) make investment decisions within a day, with 14% finalizing their choices in under an hour. Only 11% take more than a week to evaluate an investment.

Despite 63% believing that hype signifies a good opportunity, 40% of these investors regretted their decisions to invest in hyped products. The study also uncovered strong parallels between impulsive investment choices and purchases of viral everyday products, such as air fryers (42%), which topped the list, followed by smart watches (32%) and energy drinks (32%). Cryptocurrency purchases were notably high, ranking fourth at 27%.

A significant driver behind these quick decisions is the “Fear of Missing Out” (FOMO), with over half (51%) of young investors (18-40) admitting they invested more than planned due to FOMO, often leading to riskier financial decisions.

Social media has a substantial influence on these decisions, with 85% of young investors acknowledging platforms like Instagram, TikTok, and YouTube as highly influential. Additionally, 43% rely on these platforms as their primary research tools.

The FCA is urging investors to think more carefully before committing to high-risk or hyped products and to align their investments with long-term financial goals.

Lucy Castledine, director of consumer investments at the FCA, commented: “If you’re considering investing, the very first investment you should make is some of your own time. It's important to look beyond the hype, especially on social media, and do your research to make sure what you're investing in fits with your financial goals.”