UPSTOX India’s New-Age Online Broking Firm

67%, which is nearly one-third, of its clients investing in equity markets are in the age bracket of 20-40 years and almost half of the participation comes from Tier III cities, says Upstox

Tide is turning in the investor participation demographics on stock markets. Instead of seasoned market savvy middle-aged investors with a knack for the Bulls and the Bears, it’s now the ‘Millennials’ who are flocking towards the markets more than ever before.

The so-called ‘millennials’ constitute those born between the early 1980s and early 2000s, and people in this age group are the ones who are driving the stellar growth in equity market participation, from smaller towns and Tier III cities in particular, as per data shared by Upstox.

Upstox, which is one of the top discount brokers of the country offering online and mobile trading platforms, says 67%, which is nearly one-third, of its clients investing in equity markets are in the age bracket of 20-40 years and almost half of the participation on its trading platforms comes from Tier III cities.

Interestingly, the data also reveals that more than 70% of the volumes that are generated are from Mobile trading platforms. This clearly indicates a trend that the younger generation from Tier III cities, which is tech-savvy and with some disposable income or even fresh into their jobs, prefer to go the mobile phone route to participate in the stock markets.

 “Almost 70% of our orders are placed by customers in the age bracket 19 to 35 years old. We've observed this trend because unlike traditional brokers, we make it easy for users to place trades directly. The new age investor is empowered through a platform like Upstox and is confident enough to place orders independently,” says Ravi Kumar, co-founder and CEO of Upstox.

There has been a general increase in awareness about capital markets as an investment avenue among people. It is also evident through consistent increase in the number of demat accounts. Since the past year, there has been a record growth in demat account numbers, indicative of a broad-based participation and build-up of greater investor interest and confidence about equity market investments. As per data by the two depositories CDSL and NSDL, there were 3.34 crore demat accounts as of August 31, 2018, which is a whopping 20 per cent growth from 27.85 million demat accounts in 2017.

“A record growth in demat account,but decline in business for traditional brokerages suggests discount broking firms like Upstox are fuelling investor participation in stock markets,” Ravi Kumar added. 

Upstox reported a three-fold growth in participation numbers over the last 15 months, and remarkably 33% of its participation and revenues come from Tier III cities and around 42% from Tier I cities. While 23.47% of its customers placing trades on the Upstox platform are in the age bracket of 20-30 years, almost 43% are in the age bracket of 30-40 years.

“With the launch of an intuitive and online account opening experience, we saw an exponential increase of 200% in customer participation in 2017 over 2016.  We are targeting to continue with the growth rate in this year too," Ravi added.