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E-Trade finds more millennials are taking up options trading

  • E-Trade found that 40 percent of millennials surveyed trade options at least once a month.
  • 25 percent of their Generation X counterparts partake in options trading so frequently.
  • Jon Najarian, co-founder of the Najarian Family Office, said he expects more millennials to take up options trading as they become more familiar with the market.
Millennials working
Ariel Skelley | Getty Images

E-Trade Financial found a surprising demographic group has been getting into options trading: millennials.

The online brokerage firm found that 40 percent of millennials with online trading accounts trade options at least once a month, whereas just 25 percent of their Generation X counterparts partake in options trading so frequently, according to a survey released Thursday.

"Millennials are digital natives," Steve Claussen, vice president of trader strategy at E-Trade Financial, said in a release. "And within this context it's understandable why this group may also be the most active options traders, as today there are a great many digital tools that make options trading easier to understand than ever before."

Jon Najarian, co-founder of the Najarian Family Office, said millennials might find the fast-paced nature of options trading appealing, "unlike stocks, which can be like glaciers."

Options trading has exploded over the past decade. The average daily volume for options trading rose from 11.4 million in 2007 to 16.5 million in 2017, according to data from The Options Clearing Corp. That represents a 45 percent increase.

To be sure, not many millennials trade options, or at all. Millennials have been less prone to invest their money in financial markets as the 2008 financial crisis left many distrustful of Wall Street. Millennials have also had a harder time finding steady jobs, making it less likely for them to trade or invest. Many also lack the capital to invest.

Nevertheless, the stock market's rally since the U.S. presidential election may have changed some minds. Nearly 33 percent of investors age 18 to 34 recently said they plan to move more of their retirement savings into stocks, according to a MassMutual survey.

Equities have risen sharply since President Donald Trump's election, with the S&P 500 advancing more than 12 percent.

Najarian also said he expects more millennials to take up options trading as they become more familiar, and more comfortable, with the market.

— CNBC's Tom Anderson contributed to this report.

Disclosures: Jon Najarian is a frequent guest on CNBC's "Fast Money: Halftime Report."