Stock Ownership Doubles In Us In Seven Years

The demographics of investors has changed dramatically at the international markets with constantly evolving market conditions. This is particularly true of the Nasdaq Stock Market as an indepth national study conducted by Peter D Hart Research Associates shows. The stock ownership amongst the general public has doubled in the past seven years (at 43 per cent of American adults). The survey questioned 1,214 investors who own either mutual fund units or stocks in individual companies.

The survey reveals that the investor trading community has changed dramatically and that investors are no longer male, elderly and affluent. At least 47 per cent of the investors are women, while 44 per cent are white males. Of the women, 45 per cent say they are primarily responsible for the investment decisions in their households. A majority of investors (55 per cent) were under the age of 50 and half were not college graduates.

 

The survey revealed that investors were only slightly more optimistic on the issue of whether stock prices at the market would rise than there were in a survey conducted in June 1988 (when a crash had come about). The investors fundamental caution can be seen from their description of the willingness to take risks at the exchange for a higher potential rate of return. US investors were far more likely to describe themselves as "conservative" (36 per cent) or "moderate" (also 36 per cent) rather than "aggressive" (28 per cent) in balancing risk and return.

Interestingly, only 8 per cent of the investors predicted that they would sell their stocks to avoid further losses. When asked of their investment strategy in response to a significant drop in the market, 30 per cent said they would take advantage of the lower prices to buy more stock, and the larger percentage (54 per cent) would not lead them to make any changes in their investments. The research agency, however, cautioned that this reaction should not be confused with a solid prediction of the investor's future reaction.

The generation X investors (age 18 to 34) were found to be considerably more aggressive market investors (41 per cent) than the general population (28 per cent). The survey also showed that women were more likely to consider investing in MFs because of reduced risks.

According to the survey, most working-age investors describe themselves as blue or white collar workers (35 per cent) rather than managers/professionals (29 per cent).

The Nasdaq Stock Market president, Alfred R Berkeley, in a press statement said: "To me, the encouraging news in this survey is the degree to which Americans are realising that they hold the key (and bear the responsibility) for their own financial future.''

Overall, the US investors were more self-reliant for their retirement needs, making personal investments to fund retirement rather than pension or social security plans.