The Participation Rate of American Households in the Stock Market is Low

Contrary to popular belief most Americans are not participating in the stock market. Though the stock market gets most of the attention all the time in the media and even Trump finds the time to comment about it whenever there is a big move, in reality not all Americans are benefiting from the bull market. Some have totally avoided the market like the black plague after the global financial crisis wiped out their investments. Some consider the market is rigged in favor of the powerful and wealthy like it was long time ago and do not want to deal with all the drama and stress that goes with putting one’s hard-earned money in the market. As a result it is not surprising that only 35% of all households participate in the equity market. In addition, high earners participate more than low earners. The participation drops significantly for the lowest 20% of earners.

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Source: Take a Peek at What the Top 1 Percent Have in Savings, U.S. Global Investors

From the above article:

Take a look at the chart above, based on data produced by American economist Edward Wolff. Of U.S. households that rank in the top 1 percent, nearly 94 percent own $10,000 or more in equities. From there, the ownership rate drops off. Less than 5 percent of the bottom 20 percent of earners have $10,000 or more invested in the stock market, either directly or indirectly. Only 35 percent of all American households do.


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