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<p class="text"><a href="http://pewresearch.org/pubs/637/tracking-the-traders">Tracking the Traders</a></p>
<p class="text">In recent months, the U.S. stock market has seen record highs coupled with dramatic sell-offs, its volatility fueled by the sub-prime mortgage and credit crisis, the weak dollar, and oil prices heading toward $100 per barrel. At the same time, the public has grown increasingly worried about the state of the U.S. economy. </p>
<p class="text">Yet these fluctuations have a direct impact on only a limited number of Americans. Nearly half of adults nationwide (46%) say they don't have any money in the stock market. And among the half who say they do, the vast majority (43% of Americans overall) say they have some long-term investments like retirement accounts but don't trade stocks regularly. Only 7% of Americans say they trade stocks and other funds pretty regularly. </p>
<p class="text"><img alt="Figure" src="http://pewresearch.org/assets/publications/637-1.gif" /></p>
Who Are the Active Traders?
<p> </p>
<p class="text">Not surprisingly, household income is closely tied to market participation. A plurality of regular traders (38%) reports an annual, pre-tax, household income of $100,000 or more -- an income level reached by only 15% of the general public. Among those with only long-term investments such as retirement accounts and bonds, that they do not trade regularly, 23% earn $100,000 or more, 37% earn $50-$99,999, and 30% earn less than $50,000. Two-thirds (66%) of those who have no money invested in the stock market report a household income of less than $50,000. </p>
<p class="text">With retirement in the far future and thoughts of long-term financial security not an immediate concern, it may not be surprising that younger Americans are generally less likely than older Americans to trade stocks and other funds pretty regularly. According to the U.S. Census Bureau, roughly one-fifth (21%) of adults nationwide are between the ages of 18 and 29. But only 12% of Americans who report trading stocks and other funds pretty regularly fall within this age range and they comprise almost a third (31%) of the adult population without any money in the stock market. </p>
<p class="text">About half (48%) of regular traders and four-in-ten long-term investors (42%) are college graduates, significantly higher percentages than the proportion of college graduates among the general public. Of those without any money invested in the stock market, 64% have no more than a high school education.</p>
<p class="text">Non-Hispanic whites are also slightly overrepresented among regular traders and those with long-term investments. While non-Hispanic whites make up roughly 72% of the American population, 76% of regular investors and 80% of long-term investors are non-Hispanic whites. </p>
<p class="text">In addition, men as well as people who live in the suburbs and in the Northeast are among the most likely to trade stocks and other funds pretty regularly. </p>
Investors and Politics
<p> </p>
<p class="text">While Democrats outnumber Republicans nationwide by a 34%-to-26% margin in Pew's most recent surveys, regular traders lean the other way. Four-in-ten Americans who trade stocks regularly identify themselves as Republicans while only 24% are Democrats. Long-term investors are evenly split (31% identify with each political party). Those with no money in the stock market are more likely to be Democrats by nearly two to one (39% to 20%). </p>
<p class="text">The partisan difference between regular traders and non-traders is not merely due to income differences. Among regular traders who earn $100,000 or more annually, 47% identify as Republicans and just 20% as Democrats. However, among those with comparable incomes but no money in the stock market the partisan split is roughly equal: 31% identify as Republicans and 27% as Democrats. </p>
<p class="text"><img alt="Figure" src="http://pewresearch.org/assets/publications/637-2.gif" /></p>
<p class="text">In recent months, the U.S. stock market has seen record highs coupled with dramatic sell-offs, its volatility fueled by the sub-prime mortgage and credit crisis, the weak dollar, and oil prices heading toward $100 per barrel. At the same time, the public has grown increasingly worried about the state of the U.S. economy. </p>
<p class="text">Yet these fluctuations have a direct impact on only a limited number of Americans. Nearly half of adults nationwide (46%) say they don't have any money in the stock market. And among the half who say they do, the vast majority (43% of Americans overall) say they have some long-term investments like retirement accounts but don't trade stocks regularly. Only 7% of Americans say they trade stocks and other funds pretty regularly. </p>
<p class="text"><img alt="Figure" src="http://pewresearch.org/assets/publications/637-1.gif" /></p>
Who Are the Active Traders?
<p> </p>
<p class="text">Not surprisingly, household income is closely tied to market participation. A plurality of regular traders (38%) reports an annual, pre-tax, household income of $100,000 or more -- an income level reached by only 15% of the general public. Among those with only long-term investments such as retirement accounts and bonds, that they do not trade regularly, 23% earn $100,000 or more, 37% earn $50-$99,999, and 30% earn less than $50,000. Two-thirds (66%) of those who have no money invested in the stock market report a household income of less than $50,000. </p>
<p class="text">With retirement in the far future and thoughts of long-term financial security not an immediate concern, it may not be surprising that younger Americans are generally less likely than older Americans to trade stocks and other funds pretty regularly. According to the U.S. Census Bureau, roughly one-fifth (21%) of adults nationwide are between the ages of 18 and 29. But only 12% of Americans who report trading stocks and other funds pretty regularly fall within this age range and they comprise almost a third (31%) of the adult population without any money in the stock market. </p>
<p class="text">About half (48%) of regular traders and four-in-ten long-term investors (42%) are college graduates, significantly higher percentages than the proportion of college graduates among the general public. Of those without any money invested in the stock market, 64% have no more than a high school education.</p>
<p class="text">Non-Hispanic whites are also slightly overrepresented among regular traders and those with long-term investments. While non-Hispanic whites make up roughly 72% of the American population, 76% of regular investors and 80% of long-term investors are non-Hispanic whites. </p>
<p class="text">In addition, men as well as people who live in the suburbs and in the Northeast are among the most likely to trade stocks and other funds pretty regularly. </p>
Investors and Politics
<p> </p>
<p class="text">While Democrats outnumber Republicans nationwide by a 34%-to-26% margin in Pew's most recent surveys, regular traders lean the other way. Four-in-ten Americans who trade stocks regularly identify themselves as Republicans while only 24% are Democrats. Long-term investors are evenly split (31% identify with each political party). Those with no money in the stock market are more likely to be Democrats by nearly two to one (39% to 20%). </p>
<p class="text">The partisan difference between regular traders and non-traders is not merely due to income differences. Among regular traders who earn $100,000 or more annually, 47% identify as Republicans and just 20% as Democrats. However, among those with comparable incomes but no money in the stock market the partisan split is roughly equal: 31% identify as Republicans and 27% as Democrats. </p>
<p class="text"><img alt="Figure" src="http://pewresearch.org/assets/publications/637-2.gif" /></p>