By Alex Harring

Copyright cnbc

When Jacob Kaplan thinks about his path to financial security, he sees a need to take big risks.

For years, Kaplan has been betting on major sporting events through online platforms, often dedicating 30 hours a week to the hobby. The 25-year-old regularly trades tips with fellow enthusiasts through Discord and bought a membership to sports data platform Bookie Beats to help level up his bets.

“There’s the risk that goes into each individual bet that you take,” Kaplan told CNBC. “But if you surround yourself with the right people and you know what you’re doing, then it kind of answers that problem that my generation is looking to solve of finding some financial security.”

Kaplan is part of a cohort of young people pushing typical investing strategies to the side for higher-risk alternatives. They’re looking for a stroke of luck amid broad feelings of direness about the economy as home prices skyrocket, loan debt grows and the job market tightens.

This phenomenon has been dubbed “financial nihilism.” It can help explain the rise of speculative investments like meme stocks, leveraged exchange-traded funds and crypto, as well as booming interest in forums like sports betting platforms and prediction markets.

“I view this as more of a rational response on the part of the young investors who would like to achieve certain goals using their investments,” said Simon Oh, an assistant professor at Columbia Business School.

“Relatively to the past, it’s become much more difficult to do that using traditional means of wealth accumulation,” Oh said. “As a result, sort of the rational thing to do is to swing for the fences.”