Volatility has been the watchword in public markets since the turn of the year

The bull market on tech stocks continued in January before a slight correction as market dynamics shifted in response to the vaccine roll out in the US and UK. Fears of inflation and the so-called Gamestop effect, as a new generation of retail investors pile into unlikely stocks, add to the unpredictable nature of public equities in 2021. Private markets can begin to look more appealing to investors in this context. This is accentuated by several notably positive developments in the private and alternative assets sector.

Robin Hood, Freetrade and a number of other Fintech brokers have opened up retail investment to a new generation of investor – typically aged under 34, with a portfolio in the single digits of thousands that they invest and manage on a smartphone. This has had a significant impact on public markets, with Credit Suisse estimating that the new breed of investor has accounted for as much as a third of all US stock market trading at activity peaks in 2021. Gamestop is the standout example of a new type of investment thesis – driven by frenzied social media activity, a fear of missing out and a mission to take the fight to hedge funds and to hell with conventional market wisdom. Initially dismissed as a fad, market analysts and traditional investors now find themselves scrambling to understand the changed landscape.

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Source: Private Equity Wire