Russian retail investors in the digital realm: group characteristics

The notion of market devices when applied to digital investment technologies suggests that they not only construct the stock market, but influence individuals’ behaviors as well. Current article aims to outline the types of Russian retail investors (lay participants of the stock market) based on the digital technologies and tools they use, as well as to assess how different these types are in terms of their investment performance. Investment behavior is viewed as a combination of digitalized (1) trading and (2) information search and analysis practices. Data comes from the third wave of the Monitoring Study of the Economy and Society’s Digital Transformation (ISSEK HSE University, 2024, N = 10038). The sample is comprised of individuals who own stocks, bonds and/or ETFs (n = 312). K-means cluster analysis suggesting two types of retail investors: (1) active (36% of the sample), who engage in most trading and information search and analysis practices, and (2) passive (64%), who mostly trade via mobile apps, yet show little to no interest in the market information. Overall, both types primarily engage with mobile investment apps when trading, and with social networks when searching for market information. It is also found that active investors are more likely to assess their investment performance as higher than market average. This can result from the use of a wider range of digital investment technologies, which, being market devices, affect investment behavior making it more economically rational.