Why some young people are investing based on vibes, not research

Saul Oster just started investing in the stock market this year and says he plans to until he retires.

The 20-year-old University of British Columbia student says he likes the idea of passive income,  where his investments make money without much effort from him.

He says most of his friends are investing too. They regularly watch the stock market and trade. 

“There are times we’ll be sitting around and someone will tell you to buy something, and you’ll buy it. No research whatsoever, just pure gut feeling,” he told Cost of Living.

Oster and his friends are part of a growing cohort bucking traditional trading wisdom and relying on vibes and life experiences to guide their investment decisions.

According to an Ipsos poll of 1,001 Canadians conducted for CIBC’s Investor’s Edge, 34 per cent of Gen Z respondents said they found financial advice from older generations irrelevant. 

They said evolving markets, new financial tools, and changing priorities are the reasons they don’t rely on that advice.

WATCH | Gen Z is investing in the stock market more than past generations:

Gen Z is investing more money than other generations

Gen Z is proving to be more financially engaged than the previous generations and diving into investing earlier through RRSPs and TFSAs, according to Statistics Canada and a TD Bank survey, often thanks to finance becoming more digestible through influencers.

The poll also found that 21 per cent of millennials and 19 per cent of Gen Z respondents were encouraged to adopt a risk-taking attitude towards investments, which is more than the general population.  

Why people are investing based on vibes

Oster says trades he’s made based on intuition have yielded better results than moves he’s made after researching. His first major purchase was exchange-traded funds (ETF) into Canadian mining companies because he felt energy “was going to be the next big thing.”

“Over the past seven months, I’m up just over 180 per cent,” Oster said.

Instead of relying solely on research to make investment decisions, Oster and his friends use their guts. 

He says one friend invested in Walmart because, as a student, that’s where he goes for affordable prices. Oster says he figured other people concerned about their budgets would choose Walmart too.

“It’s paid off but that’s not off research. That’s just because this is what he sees and therefore what he put money into,” Oster said.

Liz Enriquez says most people, not just Gen Z, manage their money based on their emotions, not logic. She’s a personal finance mentor based in Hamilton, Ont., and founder of Ambitious Adulting, an online platform that simplifies personal finances. 

She says technology has made investing more accessible, more popular and…