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Plum launches its personal finance application in Belgium
19 July 2022
17th June, 2021. London, UK. European money management fintech Plum is today sharing new data on how its customers are reacting to the current hype around cryptocurrencies. The highly volatile asset class has seen increasing popularity among Plum customers since October, with many choosing to diversify their portfolio further to balance out the risk.
Cryptocurrencies have enjoyed a period of intense popularity in Europe and beyond since October 2020, thanks to increased savings during the COVID-19 pandemic (1), adoption of the technology by big corporations and even governments, and endorsements from influential public figures like Elon Musk. Bitcoin, for example, saw stable prices until October 2020 and has since experienced high volatility, which hit a peak in April and early May 2021.
Plum, which offers low-cost, easy-access investing in mutual funds via its app, has observed a large increase in customers investing in cryptocurrencies, despite crypto not being available on its platform yet. When looking at customer spending data between October 2020 and May 2021, the total amount invested in crypto among Plum customers has increased by 172% (2). The company has also noted that crypto investors who use Plum are younger on average than regular Plum investors – average age 31 compared to 33.
Plum found that since October, the portfolio mix of customers who invest in crypto has changed over time, reflecting a desire to diversify during times of high volatility. Crypto investors had invested $8m in Plum in October, with 55% of this being in Tech Giants, the company’s high growth technology fund. By May 2021, this had grown to $21m, with 48% of it in Tech Giants, showing a 13% drop in preference since October.
Similarly, The Medic, which offers shares of healthcare, pharmaceutical and biotechnology companies, saw an even bigger drop of 34%. Given that Tech Giants and The Medic are two of Plum’s higher risk funds, this could suggest that crypto investors are increasingly keen to diversify their portfolios, perhaps to mitigate against the volatility they are seeing with their crypto investments.
In a further discovery, Plum also found that its Socially Conscious fund has been growing in popularity among crypto investors since October. Socially Conscious, which invests in companies that meet the fund manager’s criteria for ethics, saw an increase of 59% among Plum investors that spent on crypto. This is further evidence of increased diversification, but could also indicate a desire among customers to offset the negative impact of crypto on the environment through ESG investing.
This analysis into crypto investing comes as Plum begins a major expansion of its investment offering in the second half of 2021. The company recently added its first pension product to the app, and is aiming to have stock trading and crypto exposure available later in the year. Plum is forecasted to have more than $1.5bn saved for customers by the end of 2021.
Thanos Bismpigiannis, Plum’s Head of Product – Wealth, comments: “Investment industry stalwarts like Warren Buffett have been vocal about the risks of investing everything in volatile cryptocurrencies. But we’ve seen that, in general, investors are using other investment assets to balance out the risks associated with crypto, both to their pocket and to the environment. This suggests a more considered approach than they are usually given credit for, much closer to the diversification fundamentals of investing that someone like Buffett promotes. There are signs that crypto will become more of a legitimate asset class, and could in the future be an important option for investors who have the capacity and flexibility in their portfolio to manage the risk. It’s great to see so much enthusiasm among our own customers for diversified investing ahead of our investment expansion later this year.”
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Footnotes
(1) Around £100bn extra was saved due to reduced spending during the COVID-19 pandemic in the UK ( Bank of England, Dec 2020)
(2) All statistics are from Plum internal data unless otherwise stated, taken from a sample of ~22,000. Plum is able to track transactional data from customers through Open Banking. Customer data is aggregated and read-only.
Capital is at risk when investing. Past Performance is not a reliable indicator of future results.
Plum is the trading name for Plum Fintech Limited (no. 09952199). Plum Money is the trading name for Saveable LTD (no. 09777255). Plum and Saveable's registered office is on Floor 2, 2-7 Clerkenwell Green, EC1R 0DE, London.
Plum Fintech Ltd is registered with the Financial Conduct Authority as Account Information Service Provider (FRN: 836158) and an electronic money agent (FRN: 902844). Saveable Limited is authorised and regulated by the Financial Conduct Authority (FRN: 739214).
Plum is an electronic money agent of PayrNet Limited. PayrNet Limited is authorised by the Financial Conduct Authority as an Electronic Money Institution (FRN: 900594). PayrNet Limited is registered at Kemp House, 152 City Road, London, EC1V 2NX, UK.
Plum is Europe’s ultimate app for managing money. Founded in 2016 by Victor Trokoudes (ex-Wise) and Alex Michael (ex-TicTail), Plum’s mission is to banish financial instability and make everyone better off over their lifetime. The Plum app acts like a brain by automating the parts of personal finance that people find difficult or don’t have time for. It sets aside what each person can afford, finds better deals on everyday bills, offers useful spending insights and provides a simple platform for easy-access investments. The growing Fintech, with over 1.5 million in its community, has raised $19.3 million in total since being founded and has saved more than $500m for customers. With an iOS and Android app launched in 2019, Plum has now grown to include a unique investment platform, budgeting analytics, and interest on savings. Plum is headquartered in London, UK and has offices in Athens, Greece and Nicosia, Cyprus.
Susanna Wood
PR @ Plum
susanna@withplum.com
press@withplum.com