Investing in stocks looked so easy before the S&P 500 bear market struck. But now, even young Gen Z investors are getting a taste of losing money, in some cases, lots of it.
Gen Z investors, the market's newest cohort of participants aged 25 and younger, lost half their money this year on 13 of their top holdings like Mullen Automotive, Snap and Coinbase Global, as of the middle of the year, says data from Apex Clearing. That's a bitter pill to take for investors who thought stocks only go up. And it's miles worse than the roughly 17% drop by the S&P 500 this year.
"Over the next 25 years, nearly $70 trillion of wealth is expected to transfer from baby boomers to younger generations, including millennials and Gen Z," Apex said.
Gen Z's Biggest Misses
Investors born after 1996 surged into the S&P 500 in record numbers. Their interest in stocks reinvented Wall Street and the way money is handled.
Gen Z investors impressively hold more than 1.4 million accounts, says Apex. That's noteworthy as it's already more than 20% the 6.8 million accounts held by Millennials, baby boomers and Gen X investors.
But Gen Z investors haven't been able to avoid the unavoidable reality of investors: bear markets. And in some cases, they're suffering outright crashes.
The generation's biggest miss is Mullen Automotive. The electric-car company makes and distributes electric vehicles. That's a promising industry, but a bust for investors. Shares of the stock are down more than 80% this year alone. It's not totally surprising. The company not only loses money, nearly $100 million in the past 12 months, it's yet to report any revenue.
On the bright side, it's a pretty small position for Gen Z investors. It ranks just 76 out of the 100 top positions and is just 0.2% of their combined portfolio.
Big Losers, Small Positions
And that's the fortunate part. Most of Gen Z's largest losers are relatively small positions.
Take Snap. The social media company's stock is down nearly 80% this year, making it the second-worst position in their portfolio. But it's an even smaller part of the generation's portfolio than Mullen is, ranking just 86th in popularity. That's only 0.2% of their portfolios.
Similarly, cryptocurrency firm Coinbase Global's shares are down a crushing 73% this year. That makes it the generation's third-worst stock. But it's only the 73rd largest position in Gen Z's portfolio.
It's unclear how Gen Z will adjust its investment strategy coming out of the S&P 500 bear market. But it's clear they'll no longer be the only investing generation to never have seen a bear.
Gen Z's Worst Stocks This Year
| Company | Symbol | YTD % ch. | Sector |
|---|---|---|---|
| Mullen Automotive | -80.5% | Consumer Discretionary | |
| Snap | -78.8 | Communication Services | |
| Coinbase Global | -73.4 | Financials | |
| Rivian Automotive | -69.0 | Consumer Discretionary | |
| Netflix | -63.7 | Communication Services | |
| Roblox | -61.4 | Communication Services | |
| SoFi Technologies | -59.1 | Financials | |
| PayPal Holdings | -56.7 | Information Technology | |
| Block | -55.8 | Information Technology | |
| Carnival | -54.4 | Consumer Discretionary | |
| DraftKings | -51.3 | Consumer Discretionary | |
| Lucid Group | -50.7 | Consumer Discretionary | |
| Meta Platforms | -50.5 | Communication Services |
