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Why retail investing has taken off in the U.S. but not Europe

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European retail investor participation is low compared to advanced economies. This could change.

European retail investment has been slow relative to advanced economies. The recent boom in American trading activity on platforms such as Robinhood has made that discrepancy even more visible. 

While Europe has seen retail investor participation double since 2020, Vanda Research found retail activity still makes up only 5-7 percent of total trading volume in Europe, compared to more than 25 percent in the U.S. and more than 60 percent in China. 

Despite that, there is a slew of start-ups in Europe trying to take advantage of growing interest, including Revolut, Trading 212, Freetrade and Trade Republic. 

Watch the video above to learn why retail investing has lagged in Europe, and whether a large pension gap, low interest rates and a raft of new online brokerages hitting the market could build enough momentum to change that. 

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