Gen Z shifts to ETFs, holds equity positions longer

Binance Research’s Aug. 12 report found Gen Z directed 25% of its direct-equity trading volume to exchange-traded funds in early August, up from 14.6% in June. The report shows younger users traded less frequently than older cohorts, registered higher rates of net accumulation and showed lower use of leveraged products.

The dataset covers Binance users after the platform’s direct-equity offering reached scale in June 2026 and tracks activity in direct equities, tokenized bStocks and TradFi perpetuals from June through early August 2026.

Unleveraged ETFs accounted for 18.5% of Gen Z net equity inflows in June and 21.9% in July. Overall Gen Z net equity investment fell 17.4% in July. Single-stock inflows as a share of net equity inflows declined from 77% to 74.2% between June and July, while leveraged products fell 28.5% in the same period. ETF inflows declined 2% in July. The number of Gen Z ETF holders rose 2.9% in July, while millennial and Gen X ETF holder counts fell 4.5% and 5.9%, respectively.

Holding patterns show longer-term activity among many Gen Z accounts. Twenty-two percent of Gen Z direct-equity accounts had never placed a sell order, compared with 19% of Gen X and 9% of Baby Boomer accounts; millennials registered 30% in the “never sold” category. Among Gen Z direct-equity accounts that had only bought and never sold, the largest average direct-equity purchase was Schwab’s SCHD dividend ETF at $16,567, followed by Broadcom at $12,370. Average purchases in tokenized bStocks were smaller for retail-favorite names, with Tesla averaging $633 and Nvidia $514.

Binance reported 77% of Gen Z direct-equity accounts were net accumulators, compared with 74% for Gen X and 68% for Baby Boomers. In bStocks, 76% of Gen Z accounts were net accumulators, the highest share among the cohorts in the report.

Activity in TradFi perpetuals differed from direct equities. Gen Z made an average of 13 TradFi-perpetual trades per month, versus 17 for millennials, 16.5 for Gen X and 19 for Baby Boomers. Fourteen percent of Gen Z perpetual accounts qualified as high-frequency traders, compared with 18% for millennials and 16% for Gen X and Baby Boomers.

Use of leveraged and inverse products was lower among Gen Z. About 88.2% of Gen Z TradFi-perpetual accounts recorded no activity in leveraged or inverse ETFs, versus 84.5% of millennial accounts and 85.9% of Gen X accounts. In bStocks, 98.9% of Gen Z accounts showed no activity in leveraged or inverse products. Leveraged and inverse ETFs made up 9.25% of Gen Z direct-equity turnover in July but accounted for 3.93% of net inflows that month; by early August their share of net inflows fell to 2.65%. For TradFi perpetuals, roughly 60% of Gen Z accounts were net buyers, but net flows represented less than 1% of gross volume.

Binance’s earlier analysis in the report shows Gen Z accounted for about 44% of direct-stock and bStocks users and roughly 45% of TradFi-perp users on the platform. The report also indicates more than 90% of TradFi users across generations were based in emerging markets. Thirteen percent of Direct Stocks users were Gen Z customers in emerging markets with less than $2,000 in equity assets, according to the report.

The report records continued engagement with tokenized assets and 24-hour markets alongside a rising share of Gen Z equity activity directed to unleveraged ETFs and longer holding periods.