Unleveraged ETFs have taken a larger share of Gen Z investors’ equity inflows, even as traders have pulled back on overall capital deployment over the past few months, data from Binance Research shows. The study is based on trading and account data through early August.
Researchers found that ETFs accounted for approximately 22% of Gen Z’s net equity inflows, compared with 18.5% in June. During the month, overall net equity deployment fell 17.4%, but ETF inflows declined only 2%, while single-stock and leveraged-product inflows fell much more sharply.
ETF trading also increased as a share of activity, rising to over 21% of Gen Z equity volume in July from 14.6% in June. The ETF holder base grew nearly 3%, making Gen Z the only generation in the study to record growth in ETF holders during the month.
The findings also challenge the view of young investors as predominantly high-frequency, high-risk traders, suggesting instead a more disciplined and accumulation-oriented approach.
One in five Gen Z direct-equity accounts has never sold, while 76% of bStocks accounts and 77% of direct-equity accounts are net accumulators, the highest proportion among the studied generations, according to Binance Research.
Gen Z also trades less frequently than other working-age cohorts and shows relatively little appetite for leverage.
In bStocks, Gen Z accounts averaged three trades a month, while 98.9% recorded no leveraged or inverse ETF activity. Leveraged products accounted for over 9% of Gen Z direct-equity turnover in July but only 3.9% of net inflows, suggesting they are used more for short-term trades than for long-term capital allocations.
