According to a recent study conducted at Ohio State University, less and less African Americans are investing in the stock market. A recent Black Enterprise article reports:
Though black investment rates have historically trailed whites, the rate of stock ownership by blacks increased to 34% in 2001, up more than 17% from 1992. Those gains have since diminished 12% between 2001 and 2004, according to the study, which looks at individual stocks and those within a 401(k) and IRA.
"It may be that white investors are more experienced with the stock market, so they are prepared for the inevitable drops," says Hanna Sherman, a financial planning professor at Ohio State University, referring to the 2001 recession, which scared off many black investors.
The rate of stock ownership among white households increased from 1992 to 2001, topping off at 57.5%. Unlike minority investors, their investment rate dropped less than a percentage point between 2001 and 2004. What’s more, even after equaling out traditionally higher income levels of whites to that of blacks, whites still invest more than African-Americans.
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