The rise and rise of retail investing

Stock Doctor, our DIY stock market investment software, this year celebrates its 25-year anniversary, and it is fair to say that we have witnessed a complete transformation of the investing landscape over time.

In the 1990s, stock trading was largely left to the professionals – stockbrokers and fund managers offering unit trusts to those who could afford to pay for their services.

Then came the big share demutualisations – AMP, NRMA and the sale of Telstra to the general public in three tranches starting in 1996. Suddenly hundreds of thousands of ordinary Australians became shareholders in some of Australia’s largest companies.

Investing becomes personal

We set out with a distinct mission to help this growing community of ‘mum and dad’ investors have access to professional-quality information to inform their stock investment decisions.

Our approach was simple; focus on the financial health of companies using a data-driven approach and help this new cohort of investors understand the businesses in which they were investing. Without understanding such fundamentals, investors are merely speculating and risking severe loss.

These investors weren’t necessarily after the next ‘big thing’. They still had scars from the recession of the early 90s and sky-high interest rates. They wanted to set up their family finances to pay for their kids’ education, go on that dream overseas holiday, or build their wealth for retirement.

Many of these investors continue with us to this day. In fact, the average Stock Doctor member stays with us for nine years. They are drawn by the depth of features and ease of use of the platform, the direct access to our team of equities analysts, our leading educational resources, and most of all, being part of the Lincoln family.

Evolving across market cycles

The stock market is anything but predictable, and it has certainly gone through its share of ups and downs over the past 25 years: the 1997 Asian Crisis, the 2000 Tech Wreck, 9/11, the Iraq war, the SARS epidemic in 2003… and more recently the COVID-19 global pandemic.

While the foundations of our approach remain the same, the platform has certainly evolved with the times. It is more digital, more social, and the offering has broadened.

We continually invest in research and development and have developed a robust quantitative testing environment where we can test and learn – analysing millions of financial data points, creating sophisticated stock-selection and rejection models and advanced portfolio management techniques.

The changing face of investing

According to Investment Trends, there are an estimated 1.4 million Australians actively investing in stocks today.

Close to half of these have only started investing in the last two years, motivated by more time at home in front of the computer, the entry of very low-cost online brokers, and access to cheap money through record low interest rates and government stimulus packages.

They enjoyed a relatively smooth ride for two years as the market rebounded from the deep COVID-induced lows of March 2020 and mostly rising steadily. That has all changed in 2022. Volatility has returned and for new and novice investors who have not experienced this – it can fuel fear, panic and uncertainty. Actually, that can be the feelings of experienced investors too!

Stock Doctor is designed to help investors of all ages and experiences overcome these psychological barriers, focus on the numbers, block out the noise, and make informed decisions to identify quality companies that should deliver strong returns to investors over the long-term.

Whether it’s an experienced retiree with their own self-managed super fund or a millennial day trader who wants to explore markets for the first time, stock market investors are no longer leaving it to ‘professionals’. They want to control and have ownership of their investing decisions. Having the right tools, technology and data at the tip of their fingers are now more important than ever.

At Lincoln Indicators, we provide Stock Doctor for self-directed investors and Self Managed Super Fund (SMSF) Trustees to access our exclusive quantitative research platform with essential stock insights, portfolio manager and tracker tools – helping investors make confident decisions when selecting and constructing their stock market portfolio.

To experience Stock Doctor, we invite you to take a free trial today.