Investment platforms face hangover after pandemic party

LONDON, June 13 — The trillion-dollar retail investment express is losing steam, dampening the fortunes of British trading platforms that boomed during lockdowns on the back of a meme stocks frenzy.

The “sugar rush” of the social media frenzy that propelled stocks like GameStop last year has worn off for investment platforms, said Mike Barrett, director at financial services consultancy the Lang Cat. OpenMoney’s managing director Hayley Millhouse said the company’s founders were taking a “long-term view to achieve profitability”, partly by diversifying its services.

It’s not just a problem for British platforms; US pandemic darling Robinhood posted a 43 per cent fall in quarterly revenue in April and said it was laying off a tenth of staff, sending its stock to record lows. But this year many individual investors, who watched their wealth grow during the historic rally in financial assets earlier in the pandemic, have been left nursing losses as stock prices have slid at a time of war in Europe and rampant inflation.

The gloom is reflected in their share prices, with Hargreaves Lansdown down 41 per cent and AJ Bell 27 per cent in 2022, compared with a 4 per cent fall in the FTSE 350 Index.

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