Investor Presentaiton
What do they invest and how active are they?
Only a small group invest both in stocks and derivatives in Hong Kong, and an even
smaller group in overseas stocks or derivatives.
27.
In the most recent two years, only about 15% of stock investors (or less than
3% of the Hong Kong adult population) invested also in derivatives. Only 2%
or less of the adult population invest in overseas stocks or derivatives.
Indirect investment through funds would be a complement to rather than a substitute
for stock investment.
28.
The SFC-RIS found that 9.8% of the adult population invested in funds
(excluding mandatory provident funds) in 200310. This is up from 7.8% in
2000 and 3.2% in 1997 as found by prior HKIFA surveys. However, there is
no survey finding on the degree of retail participation in both the
stock/derivatives market and the fund market. The IFA-IS did find that the
main reason for investing in funds was the low deposit rates in banks (27% of
fund investors). Other reasons include a tool for risk diversification (16%) and
for stable returns (15%). The findings may suggest that fund investors mainly
view investment funds as a better alternative to bank deposits or a
complementary tool to stocks for diversification. It therefore appears that
funds are not a substitute for stocks. Moreover, the IFA-IS found that
guaranteed funds have been the most popular fund product in the past few
years. This indicates that fund investment is likely to attract risk-adverse
investors who are more reluctant to directly invest in stocks or derivative
products.
Retail investors are more receptive to futures than options products.
29.
As discussed above, among the major derivative products (HSI futures and
options and stock options), local retail investors are more active in trading HSI
futures and Mini-HSI futures than in HSI options or stock options. This might
be because futures came first: HSI futures were introduced in 1986 while the
first options product (HSI options) was introduced only in 1993 and stock
options in 1995. Nevertheless, retail interest in stock options is slowly picking
up.
10
The definition of an investor in the SFC-RIS covers a time frame of the past two years while that in the
HKEX RIS and ORIS covers a time frame of the past 12 months only.View entire presentation