According to a survey released by Mizuho Securities on Monday, a shot in the arm could take care of stocks and especially bitcoin.
The poll of 235 individuals expecting to receive checks taking into account the latest round of COVID-19 relief signed by President Joe Biden found that two out of five recipients plan to spend at least a portion of the proceeds to invest bitcoin and shares. Based on the answers, about 10% of total gross payments, or about $ 40 billion of the $ 380 billion in direct checks, can be allocated to the world’s most popular digital asset and stock purchases.
Read: ‘$ 1.9 billion looks fake, but $ 7,000 looks life-changing’: 3 Americans tell MarketWatch how to spend their incentives
This is in line with the findings of other surveys and with a story associated with the increase in individual investors during the COVID-19 pandemic. Analysts and economists have speculated that boredom caused by the blockade coupled with earlier stimulus payments and a lack of activities to address it, an increase in the opening of online brokerage accounts, as well as interest in so-called meme stocks such as GameStop Corp. . GME,
and AMC Entertainment Holdings Inc. AMC,
See: Individual investors are back – this is what it means for the stock market
As for the current round of payments, a Deutsche Bank survey late last month also found investors are ready to use the money for trading. In fact, the poll found that investors are even more eager to push money into the market, estimating about $ 170 billion in potential stock inflows from a then-estimated $ 465 billion in direct payments.
Sign out: A new wave of fearless retail investors may be ready to pour $ 170 billion into equities, Deutsche Bank says
The Mizuho survey found that about 20% of check recipients were expected to allocate as much as 20% of their checks to bitcoin and / or shares, while 13% were expected to allocate 20% to 80%, and 2% would be expected to be 80% or more in the markets.
And between bitcoin and stocks, cryptocurrency was by far the most popular choice.
Mizuho Securities
‘Bitcoin is the preferred investment choice among check recipients. It accounts for nearly 60% of incremental spending, which could imply $ 25 billion in incremental spending on bitcoin from stimulus tests, ”Mizuho analysts Dan Dolev and Ryan Coyne wrote in a Monday note (see chart above). “It represents 2-3% of Bitcoin’s current market value of $ 1.1 billion.”
Some Americans may have received all their money. The earliest amounts of payments with direct deposits were due to accounts this past weekend. According to IRS and Treasury officials, paper checks and preloaded debit cards will begin arriving in the coming weeks. The IRS said it would not load the third round of debit card payments a person received in the first two rounds.
See: When will you receive a $ 1,400 stimulus check? Some payments have already arrived, but many made it on Wednesday
It all comes as bitcoin displays its volatility in brands, pulling back on Monday after rising above the $ 60,000 milestone for the first time over the weekend. In recent transactions, bitcoin has BTCUSD,
decreased by 56,337 by more than 6%.
Shares, meanwhile, were mostly lower to the Dow Jones Industrial Average DJIA,
S&P 500 SPX,
and the smallpox Russell 2000 RUT,
ended Friday’s record. Investors are monitoring the yield on bonds. The return on the 10-year note TMUBMUSD10Y,
rose for six consecutive weeks, leading to a shift from the previously high-flying growth stocks to stocks that were more sensitive to the economic cycle.
Also read: “There will be no peace” until the ten-year treasury yield reaches 2%, says the strategist