Go to any household in the UAE and ask yourself, ‘Who is more likely to have a crypto portfolio here?’ Is it the 21-year-old son who is at the University or the 50-year-old Dad who is a policeman?
The answer seems obvious. And that points to the reality that different generations tend to invest in different ways.
Millennials (those born between 1981 and 1996), for example, tend to invest in stocks more than older generations, consider environmental, social, and governance (ESG) factors, have higher risk tolerance and capacity, and prefer automated and app-based investing, according to TD Canada Trust, an investment company.
In the UAE, millennials are also embracing real estate, according to Unique Properties, a real estate company. Also, they are the second most likely to embrace cryptocurrencies (after Gen Z), according to Hubbis, a wealth management community.
Given these realities, what then are the best investments for millennials in the UAE? This is the question that we answer in this article.
We consider the 8 best investments for millennials, and how you can start investing in them in the UAE. These include:
- Stocks
- Bonds
- Real estate investment trusts
- Cryptocurrencies
- Gold
- ETFs
- Robo advisors
- Socially responsible investing (SRI) portfolios
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1. Stocks
Stocks still remain the most popular wealth-building asset across the globe.
This is because stocks tend to track the growth of the companies whose ownership they represent. As the global economy and particular economies grow, stocks continue to do well, producing returns for their owners.
Over the past 40 years, stocks (of different kinds) have produced higher returns than real estate, wages, bonds, gold, and cash, according to a survey by The College Investor, a personal finance website targeting millennials and Gen Z.
Source: The College Investor
Also, investors love stocks because they can earn money from them in two ways: dividend payments and capital gains. If you hold them, you can still make money. Many have built a consistent source of passive income from their stock holdings.
Though stocks are higher-risk and higher-reward assets, millennials prefer them to just saving money in savings accounts, especially as a part of their retirement planning.
As they are still far away from retirement, they have enough time to benefit from the high returns of stocks while stomaching the short-term price fluctuations.
How to invest in stocks
As a millennial in the UAE, you can invest in both local and foreign stocks.
You can do the former through any UAE-based stockbroker. Notice that in the chart above, emerging market stocks produced the highest average annual return over the past 40 years.
The UAE is also an emerging market, and there have been times it has produced even better returns than an emerging market stock index. For example, the MSCI UAE Index has a higher 5-year (19.17% to 6.81%) and 10-year (5.93% to 4.81%) annualized return than the MSCI Emerging Markets Index.
For the latter, a fintech like Sarwa gives you access to the US market, where most of the prosperous companies in the world are listed (think Tesla, Microsoft, Amazon, Google, among others). As the US remains the biggest economy and stock market, ambitious millennials must participate in it.
Tips for investing in stocks
- Do your research before selecting a stock: You can’t just open your stockbroking or fintech app and buy stocks based on gut feelings.
To wisely invest your money, you must know how to select good stocks with great potential and when to buy them. You will need a good grasp of stock market fundamental and technical analysis to achieve this.
- Invest in equity funds if you can’t research stocks: If you don’t have the time or skills to do this research, consider buying stock funds – index funds, mutual funds, and exchange-traded funds (ETFs) – instead. More on this below.
- Use a reputable broker with high value for money: A great part of learning how to buy stocks in the UAE is choosing the right broker or investment app to use.
Factors to consider include commissions, trading tools, availability of stocks, customer support, the quality of user interface and experience (UI/UX), and accessibility (the minimum balance required).
Choose the one that provides the best combination of these factors.
2. Bonds
Investors love bonds for three main reasons: capital preservation, consistent income, and hedge against market fluctuations.
They are issued by the federal government (national bonds or government bonds), corporations (corporate bonds), and government agencies or local and state governments (municipal bonds).
Bonds are less risky than stocks. Thus, you can be sure (to a reasonable extent) that you will get back the money you put into it at the bond’s maturity
This is especially true of government bonds, since they are backed by the creditworthiness of the federal government. Since they know the implications of defaulting, federal governments will do everything possible to avoid such a scenario.
While many stocks pay dividends, not all of them do. Among those who do, not all of them pay consistently. Thus, those who need consistent income may be better served by bonds, since they are mandated to make coupon payments (usually twice a year).
Finally, bonds, especially government bonds, tend to retain (or even grow) their value during market downturns and economic uncertainty. When stocks are crumbling, they tend to hold their own. This is because investors pack their money into bonds when the stock market is unhealthy.
As seen below, when economic and geopolitical factors cause the stock market (represented by the US S&P 500 Index) to crash, bonds (represented by the 10-year US Treasury) stay up:
Source: J.P. Morgan
While millennials are more risk-seeking than previous generations, they can still benefit from bonds for all three reasons listed.
By including them in your portfolio, you can reduce your risk exposure and earn consistent income. Furthermore, as you get closer to retirement, you will need to increase the portion of your retirement account allocated to bonds.
How to invest in bonds
You can buy local government and corporate bonds from any UAE stockbroker. Since the Dubai Financial Market also lists bonds from other countries in the Middle East and North Africa (MENA), Asia, and Europe, you can also get international exposure that way.
For the US market, Sarwa can help. It is no news that US Treasuries are the most globally respected safe-haven asset in the world. Thus, exposure to them may be the best way to protect your portfolio.
Tips for investing in bonds
- Do your research: Though government bonds are relatively safe, we have had cases of governments defaulting. Thus, you want to understand the state of a country’s economy before buying its government bonds.
The same thing holds for corporate bonds. Since these are riskier than government bonds, they may even need further research. Thankfully, rating agencies like Moody’s, Fitch, and S&P Global rate these bonds based on the fundamentals of the issuer company. Pay attention to its rating before buying a bond.
- Buy funds: As with stocks, you may be better off buying bond funds if you can’t do this research.
- Select a good broker: The same broker who gives you access to stocks should also have bonds on offer.
3. Real estate investment trusts
We saw above that UAE millennials love real estate. That is understandable since the UAE, especially Dubai, is a globally attractive real estate market (because of high rental yield and tax benefits).
However, a consideration of real estate vs stock market historical returns in the US and the UAE shows that stocks are the more profitable asset. Below is a snapshot from this comparison article:
Yet, real estate can be attractive if you are seeking diversification and a consistent source of income (through rent payments).
Again, not all stocks pay dividends, and not all those who pay do it consistently. But a well-managed property can produce consistent rental income.
Also, real estate, partly due to its illiquidity, is not as volatile as stocks. Thus, adding it to your portfolio can reduce overall portfolio risk.
Nevertheless, purchasing real estate has its issues: illiquidity, high capital requirement, closing costs, and ongoing costs, among others.
One way to enjoy the benefits of real estate while sidestepping these issues is to buy real estate investment trusts (REITs) instead. These are the stocks of companies that buy and sell properties (equity REITs) and those that provide mortgages to real estate buyers (mortgage REITs).
Since they are stocks, they don’t face illiquidity issues. Also, there are no closing costs and ongoing costs, only stock trading commissions (which are now very low). Finally, like stocks, you can invest in them with a small amount.
Interestingly, REITs’ returns compare favourably with stocks, even while providing the diversification and consistent income advantages. You can see this in the chart below:
How to invest in real estate
You can buy local REITs through your local stockbroker.
As before, you can buy foreign REITs listed in the US market on Sarwa.
If you are passionate about having a physical property (because of its tangibility or other subjective reasons), you can still consider purchasing real estate. You can do this through a real estate agent with experience in your desired market.
Tips for investing in real estate
- Diversify your REIT holdings: You can buy REITs from the UAE and the US, equity REITs and mortgage REITs, and REITs from companies focusing on different sectors (industrial, office space, data centers, etc).
Alternatively, you can buy an ETF of REITs.
- Focus on Class B properties: If you want to stick to physical real estate, focus on older and less luxurious properties in desired locations. When upgraded to meet modern standards, they usually provide the best returns.
4. Cryptocurrencies
Millennials and Gen Z are more willing to embrace cryptocurrencies than older generations.
With traditional financial institutions embracing Bitcoin and Ethereum ETFs, the days of viewing them as mere speculative assets may be coming to an end.
Why do millennials love cryptocurrencies?
One reason is that, although they are volatile (risky), they also offer high returns. Even after factoring in their volatility, their returns still exceed those of traditional assets.
For example, reducing the bond portion of a 60/40 portfolio (60% equity, 40% bonds) by 10% and investing it instead in bitcoin (resulting in a 60% equity, 30% bond, and 10% bitcoin portfolio) results in a higher risk-adjusted return 56% of the time, according to a study by Ecoinometrics, a bitcoin macro intelligence substack.
Source: Ecoinometrics
Similarly, many altcoins (other types of cryptocurrencies outside of bitcoin) have provided incredible returns, and their sound fundamentals make them desirable for the future.
How to invest in cryptocurrencies
You can purchase cryptocurrencies on Sarwa.
With Sarwa, you don’t need to create wallets or worry about the safekeeping of your crypto assets. You can buy crypto with your fiat and sell it for fiat on the platform.
This simple system protects you from the scams and fraud that result from receiving cryptocurrency from and sending cryptocurrency to external wallets. It also helps you approach cryptocurrency as an investment rather than a speculative asset.
Tips for investing in cryptocurrencies
- Do your research (DYOR): Many cryptocurrencies are mere social media fads. You need to dig deep to understand the value that a coin or token has before making a purchase. Ask yourself if it is useful to the ecosystem and if people will find it valuable ten years from now.
- Keep your allocation small: If you are a long-term investor rather than a trader, then your allocation to cryptocurrency should not exceed 10% of your overall portfolio. While they provide high risk-adjusted returns, their volatility remains a concern.
5. Precious metals
If you take another look at the chart by Ecoinometrics above, you would notice that a portfolio of stocks, bonds, and gold also delivers higher risk-adjusted returns 41% of the time (less than the stocks, bonds, and bitcoin portfolio but more than the stocks and bonds portfolio).
But notice a more important point they made: “During downturns and early recovery phases, gold is better than bitcoin.”
This fits with the reputation of gold as a safe haven asset that can protect investors during economic downturns and market fluctuations. In case some people forgot, gold gave them a reminder in 2025 when it kept making all-time highs when stock markets were suffering the effects of Trump’s tariffs.
Is investing in silver a good idea given the effectiveness of gold as a safe haven? Silver is about 90x cheaper than gold (according to the gold/silver ratio), at the time of writing. Thus, many consider it a better option for investors who are not rich enough to invest in gold.
Source: Gold Price
Some investors also expect that growing industrial demand for silver (due to advances in AI, electronic vehicles, among others) can make it a superior investment over gold in the long term.
How to invest in gold
If you are looking for how to invest in gold in the UAE, there are five options to consider: physical or bullion gold, gold stocks, gold mutual funds, gold ETFs, or exchange-traded commodities (ETCs).
Physical gold is in the form of gold bars and coins, and they are available at Dubai Gold Souk and other specialized bullion trading houses.
Gold stocks are the stocks of gold mining companies. These gold stocks can be combined in gold mutual funds or gold ETFs.
Finally, Gold ETCs allow you to invest in physical gold without taking physical delivery of it. The investment company purchases a large amount of physical gold and handles its storage.
Investors can purchase a share in the fund, which will represent an exposure to the underlying physical gold. They can also sell their shares and make withdrawals in fiat.
All five options are also available with silver.
If you are in the UAE, you can buy gold/silver stocks and ETCs on Sarwa.
Tips for investing in gold
- Choose stocks that truly correlate with the physical metal: A gold/silver stock can only be a good way to gain exposure to gold/silver if the earnings of the company are truly correlated with the price of gold/silver. If not, you are just buying another stock.
- Verify authenticity: If you buy physical precious metal, ensure you verify its purity and authenticity before paying. And if you pay before you get access to the precious metal, confirm there is an option to return it.
- Choose a trusted retailer: The best way to assure yourself of purity and authenticity is to buy from trusted retailers.
- Choose a trusted broker: For mutual funds, stocks, and ETCs, ensure you use a reputable broker who can provide value for money.
6. ETFs
We have mentioned ETFs many times already; it is time to focus on them.
An ETF is a basket of securities that tracks an underlying index.
Depending on the underlying security (equity, bond, REIT, cryptocurrency, currency, precious metal), an ETF can contain tens, hundreds, and thousands of assets.
For example, an industrial sector ETF will buy all the stocks that are contained in an industrial sector index and allocate money to each of them based on their market capitalization. Some will allocate money to them equally (they are called equal-weight ETFs).
When an investor buys a share of this ETF, it represents exposure to all of the underlying stocks.
Why do investors love ETFs?
It is an accessible, low-cost, and stress-free way to enjoy diversification.
The S&P 500 Industrial Select Sector Index has 78 stocks. Imagine if you want to buy all 78 stocks individually. That will involve creating 78 orders. It becomes more complicated if you want to buy based on market cap. But with a single ETF, you can gain exposure to all 78 of them.
By combining many ETFs in a portfolio, you can more effectively enjoy the benefits of diversification.
Mutual funds can also do this work. However, ETFs are more liquid since you can buy them during trading hours instead of waiting till the end of the trading day. Also, passively-managed ETFs are more cost-effective than mutual funds (which are actively managed).
ETFs are also more transparent, and they don’t require a minimum investment amount for you to get started.
How to invest in ETFs
You can buy local ETFs (especially stocks and bonds) through a local stockbroker.
Sarwa also has a stock ETF that focuses on the UAE sector.
Beyond that, there are foreign stock, foreign bond, foreign REIT, cryptocurrency, and precious metal ETFs available on Sarwa.
Tips for investing in ETFs
- Shop around for the best one: For every given asset, there are many ETFs created by different investment funds. You need to evaluate your options and select the best. Factors to consider include expense ratio, returns, holdings, tracking error (by how much their returns are different from that of the index they are tracking), etc.
- Diversify: While ETFs help you to diversify underlying securities, they also need to be diversified. For example, you can have a stock ETF that focuses on emerging markets and another one that covers the US market.
7. Robo advisors
Given that millennials are tech-savvy, many of them prefer to automate the whole investment process.
Thus, instead of worrying about which assets to buy, how to allocate their money among them, how to reinvest dividends (and other income), among others, they prefer to have the experts do it all.
These experts are called robo-advisors (or digital financial advisors or digital wealth advisors). They will seek to understand your financial goals (building retirement savings, financial independence, starting a business, among other long-term goals), risk tolerance, and time horizon, then create a personalized investment portfolio that will help you achieve your goals.
They create these portfolios with the latest technology, based on insights in portfolio management theory.
Below are sample investment portfolios for investors with different risk tolerances:
You can set up a systematic investment plan (SIP) that will automatically deduct a given amount from your account at a regular interval (usually monthly).
Also, you can choose to automatically reinvest your dividends.
Furthermore, the robo-advisor will automatically rebalance the portfolio (when it has moved away from the preferred allocation formula) at a regular schedule (every quarter, for example).
How to invest with managed investment platforms
Sarwa Invest is a managed investment product by Sarwa that helps you pursue a passive investment strategy.
We use the Modern Portfolio Theory to construct efficient portfolios that match your financial goals, risk tolerance, and time horizon.
Tips for investing in robo-advisors
- Choose reputable robo-advisors: Before committing your hard-earned money to a robo-advisor, ensure they have a reputation for expertise and experience.
- Understand their methodology: Robo-advisors differ by the methodology they use in constructing portfolios. Enquire about the methodology of the ones you are evaluating, and consider which one works best for you.
- Choose robo-advisors with the best value for money: Features like automated investing, dividend reinvestment, automated rebalancing, and personalization are a no-brainer. Choose a robo-advisor that provides them all.
8. Socially responsible investing (SRI) portfolios
Many robo-advisors also offer the option for investors to have a portfolio that matches their values.
As we saw earlier, millennials and Gen Z are huge believers in ethical or impact investing. They want to invest in companies that are making an impact in the world, and not just providing value to their shareholders. This impact can be environmental, social, or governance-related.
Many analysts believe that impact investing is a way to sacrifice some returns for the sake of social responsibility. This does not seem to be a big deal for many SRI investors.
However, other analysts have argued that impact or sustainable investing can outperform non-impact strategies.
“While the exclusion of certain sectors deemed incompatible with a sustainable approach may lead to periods of short-term underperformance in some sustainable strategies,” according to J.P. Morgan, “in the longer term we would expect an appreciation of ESG factors to be positive for returns as the world transitions towards a more sustainable economy.”
How to invest in SRI portfolios
Sarwa Invest has SRI portfolios for impact investors.
We also have a Halal portfolio for those who want to avoid assets considered haram.
Tips for investing in SRI portfolios
- Have a look at the portfolio: As ESG factors become more important, many companies have been involved in greenwashing – falsely portraying themselves and their products/services as environmentally friendly.
Given this reality, you should consider checking what a robo-advisor is investing in before choosing one.
- Shop around: Don’t assume that underperformance is a sign that a robo-advisor is sticking to impact investing, and vice versa. The difference in returns can be evidence of a skill differential among the advisors. Choose the one that provides the best value for money.
Start your investing journey with Sarwa
Sarwa provides you with access to all the best investments for millennials in the UAE. You can take the passive approach by using Sarwa Invest or create your diversified portfolio by purchasing individual assets or a variety of ETFs.
Are you ready to secure your financial future? Register with Sarwa today to invest in the top investments for millennials in the UAE.
Takeaways
- Millennials tend to embrace impact investing, prefer app-based investing, and embrace high-risk and high-return assets like stocks and cryptocurrencies. Those in the UAE also value real estate a lot.
- The eight best investments for millennials in the UAE are stocks, bonds, REITs, precious metals, ETFs, cryptocurrencies, managed portfolios, and SRI portfolios.
- Millennials often have to choose between an active or passive strategy, depending on their investment skills and whether they have the time to research the market and construct portfolios.
- Whichever investment strategy they pursue, Sarwa is an all-in-one platform that will provide them with the assets they need to build wealth.