Online stock market accounts surging – PSE study

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Online accounts now comprise 27% of total stock market accounts from a mere 6% share in 2009

YOUNGER CROWD. Along with with the trend towards online use, the PSE survey also found that the average investor age is getting younger with just over half of all stock market accounts held by people between the ages of 18-44.

MANILA, Philippines – The 2014 Stock Market Investor Profile report of the Philippine Stock Exchange, Incorporated (PSE) showed that more people are trying their hand at the stock market online. 

In 2014, online accounts surged by 35.1% to 174,592 from 129,255 in 2013. Of this total, 99.6 % or 173,895 were retail accounts.

Since 2009, online accounts have grown at a compounded annual growth rate of 43.9%.

The data for online accounts was provided by 18 online brokerage firms, including those using the PSETradex platform.

“The growth in online accounts continues to be impressive and validates our strategy of expanding the retail investor base through this platform. Online accounts now comprise 27% of total stock market accounts from a mere 6% share in 2009,” PSE President and CEO Hans B. Sicat said.

Investor accounts

Total investor accounts, which include traditional and online accounts, also rose to 640,665 in 2014, higher by 9.4% from the previous year’s 585,562 total.

Of the total investor accounts, 95.3% or 610,773 were retail accounts while the remaining 4.7% or 29,892 were institutional accounts.

The majority of the accounts were held by local investors with a 98.5% share while 1.5% were foreign accounts.

“We are pleased that more investors actively participated in the market last year, when the PSEi gained almost 23%. There is still a long way to go in terms of reaching the one million target but we are definitely on the right track,” Sicat added.

Stock market accounts were also more active in 2014 as 33.6% of total accounts traded at least once in 2014.

This represents an increase from the 23.9% share of active accounts to total accounts in 2013. Online accounts have again proven to be more active accounts with a 64.6% share in the total online account universe.

Younger investors 

The PSE also conducted a survey to profile the demographics of retail investors. 

The numbers generated from participants in the survey showed an increase in the share of investors aged 18 to 30 and those aged 31 to 44, cornering 13.1% and 37.1% of investor accounts in 2014, respectively.

In total, investors between 18 and 44 years old comprised 50.1% of stock market accounts in 2014 from a share of 46.4 % in 2013.  Among online accounts, the share of investors aged 18 to 44 to total online accounts in 2014 was higher at 73.9 %.

The income profile of investors has also become more skewed to the lower income bracket. 

Those earning an annual income of P500,000 ($10,824) or less represented 44% of investor accounts in 2014 from 37.3% in 2013. 

For online accounts, the share of those earning P500,000 or less annually is also bigger at 60%.

Investor base expanding outside Metro Manila

The survey results also showed increasing participation from investors outside the Metro Manila area. 

While majority of the investors continued to be based in Metro Manila, in 2014 the capital accounted for 68.5% of the total retail accounts, down from the 77.7% recorded in 2013.

This was due mostly to an increase in the number of investors based in Luzon, which accounted for 18.7% of the accounts in 2014 from 13.2% in 2013.

Retail investors from the Visayas and Mindanao comprised 4.4% and 2.3% of the total accounts, respectively. Investors based overseas accounted for 6.1% of the retail accounts, higher than the 2.4% share registered in 2013.

For online accounts, the share of investors in Metro Manila is even lower at 60.3% while those based in Luzon, Visayas and Mindanao are higher at 22.4%, 7%, and 4.5%, respectively.

In terms of the nationality of foreign retail investors, 30.2% were Chinese, followed by Americans (19.9% share), Europeans (7.7%), Japanese (4.4%), Koreans (4.2%) and Singaporeans (4.1%).

Sicat noted, “Technology levels the playing field in providing access to our stock market as shown by the higher share of online investors from Visayas and Mindanao.”

The PSE introduced in 2014 its stock market 101 webinars and has continued to offer more this year, including webinars about exchange traded funds or ETFs. 

In 2014, the PSE also held various provincial roadshows in Batangas, Pampanga, Cebu, Cagayan de Oro and Davao. –

$1= P 46.19

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