Latvians have a huge sum of money sitting idle in bank accounts - a total of about 12 billion euros, writes Diena.
For comparison: investments in the 3rd pension level amount to approximately 1 billion euros.
The ratio is heavily skewed in favor of deposits rather than more profitable long-term assets, and this is a problem across Europe. Nevertheless, in Latvia, positive trends can be observed both in the increase in the volume of investments and in the choice of assets.
The number of investors in Latvia has significantly increased in recent years; however, their share still remains relatively low. Data from "Swedbank" about its clients shows that only 6% of Latvians invest in financial instruments, while in Estonia it is 12%, and in Lithuania, it is 8%.
A positive factor is that over the past five years, the number of private investors has increased fivefold, and they are getting younger. The average age of an investor has decreased from 47 to 38 years during this time.
"Those who are already investing have gotten older, but many young people are also coming in. People start investing at 18-20 and at 25 when they begin working. They do not have negative experiences in the financial market, and the situation in the markets during this period has been very favorable," notes Kristaps Kopštals, head of the investment support department at "Swedbank".
The total amount invested in securities has quadrupled over the past five years, and the average investment volume of "Swedbank" clients is 11,300 euros.
"The wealthier the clients, the more they invest. Of course, not all money is invested - a certain financial cushion remains. Money in the account brings nothing, while investing helps protect it from inflation. At the same time, the older a person is, the more cautious they become - they keep more money in deposits," says Kopštals.
Data from "Swedbank" also indicates that over the past five years, investments by Latvian investors in securities have become significantly more diversified. The highest growth rates are shown by investment funds, where the number of investors has increased 16 times - today, this is the most popular type of investment. The largest decrease is observed in investments in stocks; however, in terms of volume, the largest share still belongs to them.
A survey by "Swedbank" showed that 37% of residents of Latvia have no funds to invest, 57% refrain from investing due to the risk of losing funds, 46% due to insufficient knowledge about investments, and 26% due to a lack of time to study and manage investments.
