Market Insights Financial Wealth Management

Digital Investment - China

China

In 2024, the projected total transaction value in the Digital Investment market in China is estimated to reach €146.20bn.
It is expected to exhibit an annual growth rate (CAGR 2024-2027) of 5.28%, resulting in a projected total amount of €170.60bn by 2027.
Among the various players in the market, Neobrokers are expected to dominate with a projected total transaction value of €143.70bn in 2024.
Notably, the highest cumulated transaction value is anticipated to be reached in China, amounting to €1,652,000.00m in 2024.
China's digital investment market is booming, with a surge in online trading platforms and increased investor participation.

Key regions: United Arab Emirates, Switzerland, Singapore, United Kingdom, Europe

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Analyst Opinion

China is experiencing significant growth in the Digital Investment market, driven by changing customer preferences, emerging trends, and local special circumstances. Customer preferences in China are shifting towards digital investment due to several factors.

Firstly, the convenience and accessibility of digital platforms have made it easier for individuals to invest in various financial products. With just a few clicks, investors can access a wide range of investment options and manage their portfolios online. Secondly, the younger generation in China, who are more tech-savvy, are increasingly interested in digital investment as they seek to grow their wealth and achieve financial independence.

Lastly, the COVID-19 pandemic has accelerated the adoption of digital solutions across all industries, including the financial sector. As people turned to online platforms for their banking and investment needs during lockdowns, the demand for digital investment services surged. Several trends are driving the growth of the Digital Investment market in China.

Firstly, robo-advisory services have gained popularity among investors. These automated investment platforms use algorithms to provide personalized investment advice and manage portfolios. Robo-advisors offer lower fees compared to traditional investment advisors, making them attractive to cost-conscious investors.

Secondly, social trading platforms, which allow users to follow and copy the trades of successful investors, are gaining traction in China. This trend is fueled by the desire for novice investors to learn from experienced traders and potentially replicate their success. Additionally, sustainable and ESG (Environmental, Social, and Governance) investing is on the rise in China.

Investors are increasingly interested in allocating their funds to companies that prioritize sustainability and social responsibility, driving the demand for digital investment platforms that offer ESG-focused investment products. China's unique local circumstances also contribute to the growth of the Digital Investment market. The country has a large population with a rising middle class, which creates a significant market for investment services.

Additionally, the Chinese government has been promoting financial inclusion and innovation, encouraging the development of digital investment platforms. This supportive regulatory environment has attracted both domestic and international players to enter the market and compete for market share. Moreover, China has a high smartphone penetration rate and a tech-savvy population, making it an ideal market for digital investment platforms to thrive.

Underlying macroeconomic factors further contribute to the growth of the Digital Investment market in China. The country's strong economic growth and increasing disposable income levels provide individuals with more capital to invest. Furthermore, the low interest rate environment in China has made traditional savings accounts less attractive, prompting individuals to seek higher returns through digital investment platforms.

Additionally, the Chinese government's push for capital market reforms and the opening up of its financial sector have created more investment opportunities, attracting both domestic and international investors. In conclusion, the Digital Investment market in China is experiencing rapid growth due to changing customer preferences, emerging trends, local special circumstances, and underlying macroeconomic factors. The convenience and accessibility of digital platforms, along with the rising interest in robo-advisory services, social trading, and sustainable investing, are driving the demand for digital investment services.

China's large population, supportive regulatory environment, and strong economic growth further contribute to the market's expansion. As the digitalization of the financial industry continues, the Digital Investment market in China is expected to continue its upward trajectory.

Methodology

Data coverage:

The data encompasses B2C enterprises. Figures are based on transaction values / revenues / assets under management and user data of relevant services and products offered within the FinTech market.

Modeling approach / Market size:

Market sizes are determined through a combined top-down and bottom-up approach, building on a specific rationale for each market segment. As a basis for evaluating markets, we use annual financial reports of key players, industry reports, third-party reports, publicly available databases, and survey results from primary research (e.g., the Statista Global Consumer Survey). In addition, we use relevant key market indicators and data from country-specific associations, such as GDP, consumer spending, population, internet penetration, smartphone penetration, credit card penetration, and online banking penetration. This data helps us estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the relevant market. For example, the S-curve function and exponential trend smoothing are well suited for forecasting digital products and services due to the non-linear growth of technology adoption.

Additional notes:

The market is updated twice a year in case market dynamics change. The impact of the COVID-19 pandemic and the Russia-Ukraine war is considered at a country-specific level.