Who is the typical Brazilian investor?

This year will be remembered as a year of breaking records for Brazilian capital markets. For the first time, São Paulo’s B3 stock exchange reached the historic level of 1.3 million retail investors, roughly the same number of active investors on Tesouro Direto, a system which trades Brazilian government bonds. 

Brazilians are becoming more and more interested in their finances, with the country’s lowest benchmark interest rate ever, controlled inflation and an incoming pension reform, making people reconsider how they should prepare for the future.

However, stock market and bond investors are still a minority in Brazil and the increase in their numbers is just the tipping point of a much-needed change in Brazilians’ financial behavior. 

How Brazilians invest

Research by Anbima—the national association of financial market organizations—shows that the average Brazilian investor is far more conservative than B3’s latest record implies. In 2018, 42 percent of Brazilians had some money invested in financial products (whether they started last year or had them previously); among them, 88 percent invest in savings accounts, Brazil’s most common form of investment. Private pensions come in second, with only 6 percent, followed by private bonds, with 5 percent.  

This is no surprise, as 48 percent of Brazilians believe financial security is the most...