Younger traders are pulling away from leverage and toward exchange-traded funds, according to new research from Binance covering activity on its platform through early August. Gen Z traders allocated 25% of their trading volume to ETFs in early August, with net equity inflows into ETFs rising from 18.5% in June to 21.9% in July, even as direct stock-picking fell from 77% to 74.2% of allocations over the same stretch.
The generation also traded noticeably less often than its elders. Gen Z averaged 13 monthly trades in TradFi perpetual products, compared with 17 for Millennials and 16.5 for Gen X — a gap Binance’s researchers link to a broader preference for buy-and-hold positioning over active trading.
A Buy-Only Generation, Mostly
Among Gen Z accounts trading direct equities, 22% had never placed a single sell order, versus 19% for Gen X and just 9% for Baby Boomers — though Millennials actually posted the highest buy-only share at 30%. Top holdings in Gen Z’s buy-only accounts skewed toward Broadcom, Tesla and the Schwab US Dividend Equity ETF, a mix that points to conviction bets on individual growth names alongside a defensive dividend play rather than pure momentum chasing.
Leverage aversion showed up across the board: 88.2% of Gen Z TradFi perpetual accounts recorded no activity at all in leveraged or inverse products, ahead of 84.5% for Millennials and 85.9% for Gen X. A companion Binance Research release put leveraged ETFs at just 5.9% of Gen Z’s trading volume — the lowest share of any generation — with the cohort trading at roughly 2.6 times per day versus 3.0 for other groups.
Financial Education May Explain the Caution
Binance’s researchers tie the pattern partly to formal financial education: 77% of the Gen Z investors surveyed reported having received it, the highest share of any generation studied, and 30% said they began investing during university or shortly after. Binance’s own research release notes Gen Z now makes up 44% of users on its Direct Stocks and bStocks products and has generated roughly $80 billion in TradFi volume year-to-date, compounding at 24% month-over-month, despite holding the least capital per user of any cohort.
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Binance cautioned that its direct-equities products only reached meaningful scale in June, leaving a short window for the data, and that the sample reflects behavior on a single platform rather than the market as a whole. Even with that caveat, the figures fit a broader pattern researchers have flagged elsewhere: despite growing up as digital natives with easy access to trading apps, younger investors have shown up as more risk-averse than the generations that preceded them, favoring liquid, diversified products over concentrated leveraged bets.
The generational divide extends beyond crypto-native products, too — Binance’s bStocks briefly overtook Kraken’s xStocks as the second-largest tokenized stock issuer within two months of launch, holding $610.6 million against Kraken’s $601.2 million, before Kraken reclaimed the lead by Friday, underscoring how quickly retail flows are moving between tokenized equity venues.
