Even if an immigrant is wealthy and successful, they are still 37% more likely to lose money in the stock market.
April 15, 2026
Original Paper
In and Down: The Costs of Immigrant Investors
SSRN · 6576055
The Takeaway
We assume that once someone makes it to a rich country and starts investing, the 'playing field' is level. But in Sweden, immigrant investors suffer massive losses compared to locals, even when they have the same amount of money. It’s not because they are taking bigger risks; it's because they lack the 'invisible' social ties and cultural literacy that locals use to navigate the market. This financial gap persists for generations, proving that wealth alone doesn't grant you 'insider' knowledge. It means 'equality of opportunity' is a myth if you don't also have equality of social networks.
From the abstract
Using Swedish administrative data and a carefully matched sample, I show that immigrants who participate in the stock market incur 37% higher return loss than comparable native-born investors. The gap reflects underdiversification rather than greater risk-taking and persists among second-generation immigrants, pointing to a durable disadvantage in household financial outcomes. Two patterns help explain it. First, return losses are lower among immigrants from more financially literate origin coun