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The Study, the latest in an ASX series stretching back to 1991, showed that 55 percent of adult Australians (8 million people) now include shares as an asset class in their investment portfolio, up from 51 percent last year (7.4 million people).
Carried out in November 2004 among a sample of 2,402 adult Australians randomly selected from across the country, the Study provided a detailed snapshot of the nation’s shareholding ranks, measuring their numbers, circumstances, behaviour and attitudes.
The overall share ownership level measures three categories of shareowner:
- Direct share ownership only - 23 percent. Direct share ownership includes shares in a company listed on a stock exchange (not part of a fund), or other listed investments such as a listed property trusts, options, warrants or futures. This is up from 22 percent last year.
- Indirect share ownership only – 11 percent. This includes an investment in a managed fund that is not part of a superannuation fund, or a personal superannuation fund. Indirect ownership has declined slightly from 12 percent in 2003.
- Both direct and indirect – 21 percent. Investors that have a combination of the two styles of investment, up from 17 percent.
Western Australia had the highest reported increase in the level of share ownership (eight percentage points). The sample size from Western Australia was small and the figures therefore need to be viewed in the context of year on year growth in the area, rather than a direct comparison with ownership levels in other states.
There is also an increase of new investors in the market with five percent acquiring shares for the first time in the past two years. This figure was at four percent in 2003 and just two percent in 2002.
Trading activity has increased slightly with the average investor trading seven times per year, compared with six and five in 2003 and 2002 respectively. Average value of trades increased around five percent to $11,150 from $10,650 in the previous survey. The value of the average portfolio is $41,400, an increase of around one percent. Both of these probably reflect the entry of new investors, reducing the extent of the average increase.
Newspapers, financial advisors along with family and friends, are the sources of information that most influence share trading decisions.
As part of the 2004 Study, ASX also commissioned qualitative research, conducted in September. Respondents in the qualitative stage expressed the view that shares have ‘come good’ in the last 12 months or so. They understood that the market goes in peaks and troughs, with property being seen to have had its day for now. Many said that shares have taken over as the stronger performer. A strong economy and good company profits were cited as factors behind the performance of shares.
ASX Deputy Chief Executive Officer, Colin Scully said: “ASX is pleased to observe the continued strength of participation in the sharemarket. This rise in the number of investors suggests a widening of the shareholder base, and their comments in our qualitative study point towards a growing level of sophistication. However, we should note that while retail investors are important, they account for less than a quarter of share value traded on ASX.”
According to ASX data, retail investors accounted for around 55 percent of all trades on ASX for 2004, but only around 22 percent of the total value traded on ASX. According to the Australian Bureau of Statistics, Australian households own around 22 percent of all Australian equities. Pension, or superannuation funds, international investors and corporations own the remainder.
Share Ownership Study 2004 - presentation.
Share Ownership Study 2004 - background info.
Share Ownership Study 2004 - highlights .
Background Information
ASX Share Ownership Study
The 2004 ASX Share Ownership Study (SOS) is the ninth such study from ASX. The study
looks at attitudes, behaviour and demographics of the Australian population in relation to
shares and share ownership.
The main aim of this research is to track the incidence of share ownership among the Australian population and profile shareowners and non-shareowners demographically, attitudinally and behaviourally.
Research Process
Stage 1: 10 mini-group with current and potential share investors in Sydney, Newcastle &
Brisbane covering males & females, across differing age groups and household incomes
(undertaken by arnold+bolingbroke in September 2004)
Stage 2: 2,402 randomly selected adults aged 18 plus across Australia participated in a telephone survey undertaken by Millward Brown in November 2004. The data was weighted according to ABS figures for age, state and gender to reflect the Australian population. Stage 3: 25 in-depth one-on-one face-to-face interviews with current and potential share investors in Sydney, Wollongong, Brisbane, Gold Coast & Melbourne (currently underway by arnold+bolingbroke).
The Market Research Companies
arnold+bolingbroke & Millward Brown are both well-renowned independent international
market research companies who provide qualitative and quantitative research for many blue
chip companies and well known brands across the globe.
FIDA & NGF
This research has been funded by the Financial Industry Development Account (FIDA) of the
National Guarantee Fund.
