Times are changing – and this is particularly true when it comes to investing. Whereas the savings account was “the” preferred form of investment for generations of Austrians, things look very different for the younger generation. Between finfluencers, digital wallets, crypto, and trading, Gen Z navigates online investment platforms with confidence, enjoys investing in ETFs or individual shares, and isn’t afraid of cryptocurrencies either.
Note: Investing in securities involves risks as well as opportunities.
The focus is clearly on medium- to long-term wealth accumulation and financial independence. Suddenly, the savings book looks rather outdated. Yet these new opportunities also bring new problems and challenges.
Gen Z: well-educated and willing to take risk
As digital natives, the youngest generation of investors generally has a solid financial education, actively seeks out information, and acts with significantly greater personal responsibility than their parents’ or grandparents’ generation. With the prospect of higher potential returns, Generation Z is also significantly more willing to take risks: as a study by Erste Bank from last year shows, risk appetite among this group is particularly pronounced at 39% and thus well above the average of 24%.
Get rich fast?
However, particularly in trading – the short-term buying and selling of financial instruments – this willingness to take risks can also come with dangers. Even though the investor George Soros once managed to become about a billion dollars richer in a single day thanks to one of the most legendary trades of all time – a bet against the British pound – trading has, in many cases, gone spectacularly wrong as well.
Common trading mistakes
Too much risk per trade
Many investors stake 10 to 50% of their capital on a single trade. The result: after a few unsuccessful trades, their balance is quickly depleted.
No clear plan
Blindly following your gut feeling or social media tips is just as bad as jumping into hyped trades simply because everyone else is doing it and you’re afraid of missing out (FOMO – Fear of Missing Out).
Constant change of strategy
Successful trading depends on learning from mistakes and doing better next time. However, this only works if you follow a clear, consistent method. Constantly switching between different approaches – such as indicators, news, or copy trading – only causes chaos and leads to losses.
Emotions instead of reason
This is where the greatest risk of losing money awaits: greed or fear can lead to taking profits too early, avoiding good trades, or failing to cut losses soon enough.
Overtrading
Too much is never a good thing – and that applies to trading, too. Over-activity can therefore often have a negative impact, whereas patience is usually rewarded by the markets.
Excessive leverage
Investors looking to make money quickly often use leverage, particularly when trading cryptocurrencies. This involves trading with more money than you actually have. As long as the market is rising, this is a great strategy. However, even small, normal downward market movements can lead to significant losses or even a total write-off.
The underestimated effort behind the crypto hype
Whether it’s Bitcoin, Ethereum, altcoins, or stablecoins: cryptocurrencies are on everyone’s lips and have evolved in recent years from a niche technology into a recognised asset class. Yet the world of digital assets is not only innovative, exciting, and enticing, but also complex and subject to significant price fluctuations. As a beginner, you therefore need some time and a great deal of specialist knowledge to understand how it works, get to know the different types of cryptocurrencies, and assess the associated risks.
Added to this is a considerable initial effort before you can start mining “digital gold” – from opening an account and verifying your identity to setting up a personal wallet. Once you’re finally ready to embark on the crypto adventure, you need to keep a constant finger on the pulse of the markets to avoid making mistakes when actively trading. And then there’s the matter of documenting every single trade – because profits from crypto transactions are taxable in Austria. Investing soon starts to feel like a second job.
Next level investment without the next-level effort
Fortunately, anyone wishing to invest in digital assets without going through all that trouble now has a convenient alternative: with ERSTE DIGITAL ASSETS, you can outsource the complexity whilst retaining full control. Instead of having to worry about “DIY trading”, investors benefit from the tried and tested professional management of Austria’s market leader in investment funds. This makes it easy to invest in cryptocurrencies and technological innovations such as big data, gaming, cyber security, and alternative energies, without any hassle.
Thematic focus on future trends
The fund combines traditional equity investments with innovative themes and invests in digital assets that reflect the future and focus on long-term trends:
- 50% of the fund’s assets are invested in MSCI World ETFs,
- 30% in thematic ETFs that track trends in blockchain, fintech, and related technologies,
- and up to 20% in crypto-assets such as Bitcoin and Ethereum.
The combination of equity funds, equity ETFs, and ETPs within a single fund is notable for its cost-effectiveness and is specifically aimed at investors willing to take risks who wish to invest in the performance of crypto-assets for the first time, prefer a passive approach, and do not wish to manage trading or reallocation themselves.
Note: As part of active management, the portfolio positionings mentioned may change at any time. The positions listed here have been selected as examples and do not constitute an investment recommendation. There is no guarantee that the security will be permanently included in the portfolio.
An overview of the fund mix
🌍 Global equity ETFs allow for broad diversification across regions and sectors and form the robust foundation of modern investment strategies.
🪙 Crypto assets are digitally generated units based on blockchain technology that are used as investment and payment instruments. At the same time, they are associated with high volatility – a factor that can be better absorbed within the context of a broadly diversified fund.
♻️ Alternative energy encompasses technologies for generating electricity and heat from renewable sources such as solar, wind, or water.
🔒 Cybersecurity forms the digital shield of modern businesses and fosters trust in an increasingly interconnected world.
🤖 Artificial intelligence and Big Data transform vast amounts of data into intelligent solutions and drive the next generation of technological innovations.
Expertise in multi-asset management
Even those who are willing to take risks and are open to modern financial instruments appreciate having a trusted partner at their side who knows the market and has many years of experience. Erste Asset Management is the market leader in the investment fund sector and manages assets of about EUR 107.25bn, invested across more than 380 funds. Approximately EUR 11bn is managed in mixed portfolios in Austria.
The investment department at Erste Asset Management comprises consist of 100 investment professionals across all the group’s countries. They have an average of over 20 years’ professional experience. To ensure optimal investment outcomes, Erste Asset Management’s fund managers also work closely with the in-house research department.
Investing with a plan and a goal
Anyone wishing to take advantage of the opportunities offered by digital assets for their investments can either invest a lump sum in the ERSTE DIGITAL ASSETS fund or build up capital over the long term using the s fund saving plan – starting from just EUR 50 per month.
Please note: The average cost effect decreases as the term of the savings plan increases, as the accumulated assets increasingly behave as if the total amount had been invested in a single transaction. Depending on market developments, a one-off investment may also prove to be more favourable. Investing in securities involves both opportunities and risks.
To find out more about all the details, it is best to arrange a consultation at a branch of Erste Bank and Sparkassen (savings banks). The investment experts will be happy to answer any questions, address individual wishes and interests, and develop a bespoke investment strategy based on these.
Alternatively, you can also invest in the fund online via George, Austria’s most modern banking platform.
Opportunities and risks:
Benefits for the investor
- Investment focus on shares and digital assets
- The investment objective is long-term capital growth.
- By investing across different asset classes, risk is diversified, which can help reduce the risk of loss.
- Investment funds are special assets.
Risks to bear in mind
- The assets may be exposed to market, liquidity, exchange rate, deposit, and operational risks.
- Investments in cryptocurrencies such as Bitcoin and Ethereum are subject to high price volatility and may result in significant losses in value. Cryptocurrencies are considered speculative, are highly volatile, and may be subject to regulatory changes that could have a negative impact on the fund’s value.
- Capital loss is possible.
- The following risks may be of particular relevance to the fund: credit risk, counterparty risk, liquidity risk, deposit risk, derivative risk, and operational risks. For comprehensive information on the risks of the fund, please refer to the prospectus and to the information for investors according to sec. 21, part II, chapter “Risk notices” of the Austrian Alternative Investment Fund Managers Act.
Risk notices
Please note that investing in securities also involves risks besides the opportunities described.
The fund employs an active investment policy and is not oriented towards a benchmark. The assets are selected on a discretionary basis and the scope of discretion of the management company is not limited.
Warning notices according to the Austrian Investment Fund Act of 2011
ERSTE DIGITAL ASSETS may invest a significant portion of its assets under management in shares of investment funds (UCITS, UCI) as defined by sec 71 of the Austrian Investment Fund Act of 2011.
Legal disclaimer
This document is an advertisement. Unless indicated otherwise, source: Erste Asset Management GmbH. The language of communication of the sales offices is German and the languages of communication of the Management Company also include English.
The prospectus for UCITS funds (including any amendments) is prepared and published in accordance with the provisions of the InvFG 2011 as amended. Information for Investors pursuant to § 21 AIFMG is prepared for the alternative investment funds (AIF) administered by Erste Asset Management GmbH pursuant to the provisions of the AIFMG in conjunction with the InvFG 2011.
The currently valid versions of the prospectus, the Information for Investors pursuant to § 21 AIFMG, and the key information document can be found on the website www.erste-am.com under “Mandatory publications” and can be obtained free of charge by interested investors at the offices of the Management Company and at the offices of the depositary bank. The exact date of the most recent publication of the prospectus, the languages in which the fund prospectus or the Information for Investors pursuant to Art 21 AIFMG and the key information document are available, and any other locations where the documents can be obtained are indicated on the website www.erste-am.com. A summary of the investor rights is available in German and English on the website www.erste-am.com/investor-rights and can also be obtained from the Management Company.
The Management Company can decide to suspend the provisions it has taken for the sale of unit certificates in other countries in accordance with the regulatory requirements.
Note: You are about to purchase a product that may be difficult to understand. We recommend that you read the indicated fund documents before making an investment decision. In addition to the locations listed above, you can obtain these documents free of charge at the offices of the referring Sparkassen bank and the offices of Erste Bank der oesterreichischen Sparkassen AG. You can also access these documents electronically at www.erste-am.com.
Our analyses and conclusions are general in nature and do not take into account the individual characteristics of our investors in terms of earnings, taxation, experience and knowledge, investment objective, financial position, capacity for loss, and risk tolerance. Past performance is not a reliable indicator of the future performance of a fund.
Please note: Investments in securities entail risks in addition to the opportunities presented here. The value of units and their earnings can rise and fall. Changes in exchange rates can also have a positive or negative effect on the value of an investment. For this reason, you may receive less than your originally invested amount when you redeem your units. Persons who are interested in purchasing units in investment funds are advised to read the current fund prospectus(es) and the Information for Investors pursuant to § 21 AIFMG, especially the risk notices they contain, before making an investment decision. If the fund currency is different than the investor’s home currency, changes in the relevant exchange rate can positively or negatively influence the value of the investment and the amount of the costs associated with the fund in the home currency.
We are not permitted to directly or indirectly offer, sell, transfer, or deliver this financial product to natural or legal persons whose place of residence or domicile is located in a country where this is legally prohibited. In this case, we may not provide any product information, either.
Please consult the corresponding information in the fund prospectus and the Information for Investors pursuant to § 21 AIFMG for restrictions on the sale of the fund to American or Russian citizens.
It is expressly noted that this communication does not provide any investment recommendations, but only expresses our current market assessment. Thus, this communication is not a substitute for investment advice.
This document does not represent a sales activity of the Management Company and therefore may not be construed as an offer for the purchase or sale of financial or investment instruments.
Erste Asset Management GmbH is affiliated with the Erste Bank and austrian Sparkassen banks.
Please also read the “Information about us and our securities services” published by your bank.
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