Risk-averse Europeans have embraced share trading during the coronavirus pandemic, encouraged by soaring stock markets, rising household savings and the popularity of low-cost trading platforms.
The number of people in Germany who own shares directly or via funds rose by 2.2m to 12.4m last year — with the sharpest rise among those aged under 30, according to a recent report by the Deutsches Aktieninstitut, which represents German publicly traded companies.
This is a significant shift for a country with relatively low levels of share ownership and where people are traditionally conservative with their money — often preferring to earn meagre interest on bank deposits rather than invest in shares.
Christine Bortenlänger, managing director of Deutsches Aktieninstitut, said the “sensational” increase in share ownership, which included 600,000 people aged under 30 buying their first share last year, was “a good sign for the equity culture in Germany”.
Yet there is a long way to go before Germany catches up with other countries. Even after the latest surge, only 15 per cent of Germans have a direct investment in the stock market, compared to about 55 per cent in the US and 33 per cent in the UK.
The investing craze is also catching on in the Netherlands, where the number of households investing in shares either directly or through funds increased 17 per cent to 1.75m last year, the biggest increase since the 1990s, according to a recent survey by Kantar.
Europe is Americanising and whereas investing used to be a hobby it is now a necessity because interest rates are so low and pension systems are becoming unsustainable
In France, 1.34m people bought at least one share last year, of which 400,000 had not done so since 2018, according to the French market watchdog. The total was down slightly from the previous year when the numbers were boosted by the privatisation of the gaming monopoly, Française des Jeux.
The rise in retail share trading in Europe reflects a number of factors. Stock markets have rebounded sharply from the initial impact of the pandemic, Europeans have saved money they would have otherwise spent on holidays and going out, while many have been stuck at home with extra time on their hands during lockdowns.
It has also become easier and cheaper in recent years for Europeans to invest in the stock market thanks to newly launched “neo-brokers” that have undercut the banks' high brokerage fees by offering zero-commission trading via user-friendly apps.
“Europe is Americanising and whereas investing used to be a hobby it is now a necessity because interest rates are so low and the pension systems of European countries are becoming unsustainable,” said Nick Bortot, founder of Dutch neo-broker Bux, which has attracted over 400,000 clients since launching 18 months ago.
The last time there was a similar boom in share ownership in Germany it did not end well. Millions of people bought shares for the first time in the 1996 privatisation of Deutsche Telekom and on the Neuer Markt technology exchange, both of which plummeted when the dotcom bubble burst, putting many Germans off the idea of buying shares.
European interest in share trading has been further boosted by the recent uproar about retail investors pushing up the share prices of some US companies, such as console retailer GameStop, and triggering losses at hedge funds.
Christian Hecker, co-founder of German neo-broker Trade Republic, said 5 per cent of its customers traded GameStop shares, while 80 per cent were investing an average of €300 a month in long-term savings. Its customer numbers quadrupled last year to 600,000, half of them buying shares for the first time.
“We have three huge problems in Europe: a demographic decline that is putting pressure on pensions, negative interest rates and the expectation of rising inflation, which all create a toxic mix for savers,” said Hecker.
A British opera and theatre designer has told of an “intimidating” post Brexit experience in Schiphol airport in Amsterdam which nearly cost him his first paid job since the pandemic started a year ago.
Andrew Edwards says the “roadblock” he experienced is a foretaste of the “humiliation” to come once Europe reopens its borders with musicians, crews, and crafts people working in the arts now required to have paperwork to ply their trade in each country.
In an open letter to Boris Johnson and the Brexit minister Lord Frost, he urges the government to reopen talks to negotiate an EU-wide visa system for touring arts workers and to launch a one-stop portal “providing clear information about the paperwork and access requirements for freelancers to travel and work within Europe”.© Photograph: Antonio Olmos/the Observer Andrew Edwards: Edwards: ‘It is really embarrassing being British and I didn’t used to think that.’
His open letter has been signed by 114 signatories including choreographers, lighting directors, actors, and designers.
Edwards, who works everywhere from the Globe to France’s national theatre, the Comédie-Francaise, says he was “embarrassed” to be British and fears for his future livelihood which up to now has relied 80% on EU clients for work.
He was in transit to Austria where he was due to fulfil a contract for a production of Priscilla, Queen of the Desert due to open in April. But he ended up missing his connecting flight after border officials kept him waiting for 45 minutes before approving him for onward travel.
He then had to wait two days in Amsterdam, at his own expense, to get the earliest next flight to Austria.
He said he had all the paperwork now needed for artists, musicians and theatre production staff to work in the EU, but claimed he was singled out with other British passport holders for questioning about his right to travel after his flight touched down.
“It is really embarrassing being British and I didn’t used to think that. I used to be really proud of my country but I’m not proud of what we do,” he said.
From 1 January the Dutch government imposed an entry ban on all non-EU and non-Schengen state nationals who were travelling with “non-essential purposes due to EU-wide Covid-19 restrictions”.
He says he was fully aware of the current travel restrictions apply to those trying to enter the Schengen area, but he had all his paperwork in order including negative Covid tests, and a letter from the Austrian authorities permitting him entry to the country for “essential” business.© Provided by The Guardian Schiphol airport, where Edwards was delayed by border checks. Photograph: BSR Agency/Getty Images
“When I got off the flight in Amsterdam, all passenger Covid tests where checked before we were allowed in the terminal.
“However, when we got to border control an official was shouting out ‘EU passports’ please use the electronic gates, British passports and other nationalities you have to queue.
“I asked the official if ‘my passport is still the old EU type [with burgundy cover] can I use the gates?’ She laughed and said ‘I am afraid not, you have to have your papers checked’,” he said. “It was completely humiliating”.
The culture secretary Oliver Dowden has said his department is working to resolve the issues but Edwards says he feels self-employed workers like him will get left behind.
Even if freedom of movement is not restored for touring and visiting artists, crews and crafts people, the government must move swiftly to enable freelancers to continue to ply their trade post Brexit, said Edwards in his letter.
“We cannot wait four years for a solution to this crisis, we must get back to the table with Europe,” he said.
He and his fellow signatories want the government to immediately set up a portal “that provides clear information about the paperwork and access requirements for freelancers to travel and work within Europe”.
And they want Johnson and Frost to return to the negotiating table and reopen talks with Brussels on “creating a clear and functional system providing visas and work permits within Europe, allowing entry to Europe as a whole, not country by country.”
The issue of work permits for musicians and others in the culture sector has, along with the restrictions on fishers, become emblematic of the government’s sovereignty-first Brexit policy with work permits and carnets for equipment now needed across the EU.
“The arts freelancer culture workforce is a hidden backbone of the British economy with £7.7bn contributed annually,” said Edwards. “The truth is freelancers are falling into unemployment” and may not be able to deliver on “work and commitments” that “can be scheduled years in advance”.
A government spokesman said “Due to the ongoing pandemic, many countries including some EU member states are applying restrictions on entry for British nationals. We advise everyone to check FCDO travel advice for the country they are travelling to before leaving.”
The culture minister Nigel Huddleston said that the “door always remains open” for further talks.
“A working group has been set up by the secretary of state to look at any obstacles which might face British performers seeking to tour,” he said.
new video loaded: New Covid-19 Infections Have Fallen to Half in Europe, W.H.O. Says
transcriptNew Covid-19 Infections Have Fallen to Half in Europe, W.H.O. SaysHeightened restrictions on social interaction have caused the rates of Covid-19 cases to fall in Europe. But the World Health Organization cautioned that new cases were still 10 times as high as they were last May.
For the second consecutive week, less than one million new cases were reported as transmission continues to slow across the region. The decrease in new cases in the past month is driven by countries that have implemented new measures to slow transmission. New reported cases have declined by almost a half since the end of 2020. However, to put that into perspective, the number of new cases in the region now is 10 times higher than in May last year. The burden is real, and it is significant. About one in 10 Covid-19 sufferers remain unwell after 12 weeks, and many for much longer.
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