Around 400,000 new investors entered the stock market in 2020. Then another 70,000 in the first quarter of 2021. The figures communicated by the Autorité des marchés financiers (AMF) are clear: there has been a trend reversal, the holding of actions en direct has recently attracted savers who, until now, did not (or no longer) engage in this practice.
This renewed attraction for the markets is also found in life insurance, where the proportion of risky vehicles continues to increase, and in employee savings plans, where funds invested in equities are gaining ground.
For the savings of the French, this is rather good news. Because despite regular crises, the stock market continues to assert itself as the best long-term investment. Especially since risk-free investments have seen their performance erode regularly in recent years, with rates of return that often no longer even compensate for inflation. Euro-denominated life insurance funds, for example, reported an average of 1.30% in 2020, according to the French Insurance Federation, and are expected to continue to erode. Security is therefore starting to be expensive and reduces the purchasing power of savers.
The Stock Exchange has a more attractive profile: since the start of the year, the CAC 40, the flagship index of the Paris Stock Exchange, has increased by around 21%. And some 35% over one year. A leap forward in share prices to which must be added the amount of dividends, that is to say the share of profits returned to shareholders.
Not a walk in the park
The health crisis, however, made it possible to recall that the approach is not without risk, since this same index had abandoned 40% of its value in March 2020, before firmly recovering and recovering, in a few months, all the abandoned ground. . The oldest savers have seen others: in 2001 with the explosion of the Internet bubble, in 2008 with the bankruptcy of Lehman Brothers, and even in 2011 with the euro crisis.
In short, the Stock Exchange is not a walk in the park. Better to have a strong heart to invest in it and have, alongside, savings placed in safety, on which you can rely in case of urgent need for money.
Fundamentals that budding investors do not always master, who also seized the AMF’s mediator en masse in 2020, after having suffered some setbacks. In one year, Marielle Cohen-Branche received 1,479 applications and issued 505 opinions. “Many files dealt with problems of execution of stock market orders of novice investors, sometimes by ignorance of the basic rules of the investment in shares, sometimes by lack of sufficiently clear information. Disputes relating to poor execution, bad information or bad advice represented 90% of the cases handled ”, she explained at the beginning of the summer, when presenting her annual report.
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