The role of trading apps in shaping investment behavior

We study the connection between trading app usage and investment behavior. To this aim, we collect data from 503 participants, which are representative for German Neobroker users, Ex-Neobroker users and Neobroker usage planners. We investigate Neobroker users by a number of aspects regarding demography and investment characteristics, in particular we find that Neobroker users are significantly more risk tolerant than the general German population and Ex-Neobroker users. Trading app users have a tendency to invest in more or different products than originally planned. Low trading fees and the low minimum investment amount are the main reasons for the use of trading apps. We observe that investors who stop using trading apps mostly stop investing all together. Another worrying result is that financial literacy among all groups is low and most Neobroker users have wrong conceptions about how trading apps earn money. In general, the financial literacy of all groups considered in this study is surprisingly low.