PH online stock market 2016 accounts up 28%

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THE number of online stock market accounts rose nearly 28 percent in 2016 to hit over 300,000, driven by a fast-growing market technology, a report the Philippine Stock Exchange (PSE) showed over the weekend.

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The PSE’s 2016 Stock Market Investor Profile showed that online accounts went up to 302,516, up 27.8 percent from 236,669 in 2015.

The total number of stock market accounts, both online and traditional, grew by 8.5 percent to 773,187, from 712,549 in 2015.

“Technology has played a big role in the growth of our investor base over the years. We are pleased to see that more Filipinos have continued to adopt online trading to invest in the stock market,” PSE President and Chief Executive Officer (CEO) Ramon Monzon said.

The PSE said nearly 40 percent of investors are 30 to 44 years of age, while 26.4 percent is 45 to 59. Those who are 60 and above comprise 19.3 percent and the millennials between 18 and 29 account for 14.8 percent.

Geography

In terms of geography, 96.1 percent of the total investors are in the Philippines and the rest are based
overseas.

The concentration or 70.6 percent of retail investors is in Metro Manila. Those based in Luzon comprise 16.4 percent, while investors in Visayas account for 6.2 percent and those based in Mindanao account for 2.9 percent.

Overseas-based investors account for 3.9 percent of retail accounts.

“We are pleased with the continued growth of stock market investors …” Monzon said.

“Clearly, we have a long way to go and we at the PSE will continue our financial literacy programs to demystify stock market investing and making investing as understandable and accessible as bank or insurance products,” he added.

Online trading

The growing number of online accounts also translated to higher trading activity. In 2016, 53.7 percent of the total market transaction, measured by the number of trades, was driven online trading.

“This was the first year that online transactions were responsible for more than half of the market’s total transactions,” the exchange said.

Value turnover via online trading grew by 41.4 percent, equivalent to 9.3 percent of the market’s total turnover.
In the past year, the PSE has intensified its market education efforts by doubling the number of free seminars in Cebu and Metro Manila.

To attract more tech-savvy Filipino investors, the PSE is regularly conducting free webinars to discuss basic and intermediate topics. Nearly 500 participants join each webinar session.

Younger online investors

A PSE survey showed that close to three-quarters of online retail investors are between 18 and 44 years old.
The PSE said 21.7 percent of online investors are between 18 and 29 years old, while 52.9 percent is 30 to 44 years old.

Those who are 44 to 60 years old account for 18.4 percent, while those in their 60s and above account for 7 percent.

Metro Manila investors accounted for 57.0 percent of total online accounts. Those in Luzon accounted for 26 percent, and those in the Visayas accounted for 6.8 percent and those in Mindanao accounted for 4.2 percent.

The share of overseas-based clients is also higher at 5.9 percent of online accounts.

The PSE survey showed that 60.3 percent of online investors is earning P500,000 or less annually, while 23.7 percent earns between P500,000 to P1 million, and 16 percent is in the above P1 million income bracket.

“The numbers show that more investors are finding out that participating in the stock market is actually an affordable investment,” Monzon said.

“We are also happy that our online brokers have been able to reach out to more Filipinos outside of Metro Manila towards making stock market investing more inclusive,” he added.

Online investors trade or buy and sell stocks on their own. Traditional investors trade via their stock brokers.

Through their trading accounts, online investors have access to research, while traditional investors get research reports and discuss investing options with their brokers.

The minimum amount required to open an account and the trading fees and commissions of online stockbrokerage firms are usually lower than what the stock broker charges traditional investors.

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