Retail investors heading to Net

PUBLISHED : Tuesday, 21 December, 1999, 12:00am
UPDATED : Tuesday, 21 December, 1999, 12:00am

Hong Kong will see an eightfold increase in the number of retail investors trading through the Internet next year, according to a survey by the Securities and Futures Commission.

About 14 per cent of the survey's respondents also indicated there was unfairness in the stock market because of manipulation, insider dealing and insufficient trading information.

The SFC, which carried out the survey in September and October, interviewed 2,273 adults from the general public and found among them 621 it defined as retail investors.

Of the retail investors interviewed, only 1 per cent said they had traded via the Internet.

However, 8 per cent said they would like to trade on-line in the coming 12 months.

The study proved the rapid development of Internet trading in the securities markets, Hong Kong Stockbrokers Association chairman Paul Fan Chor-ho said.

Mr Fan said he that expected more brokers would offer on-line trading services.

At present, Celestial Securities, Instinet Hong Kong, South China Brokerage, Phillip Securities, KGI Asia, Boom Securities, United Mok Ying Kie, and Mansion House are the houses which are offering Internet-trading services.

Jardine Fleming Securities will also offer Internet trading services to customers next year, according to director Patrick Sun Ting-wah.

'With the increasing popularity of Internet trading, it would be difficult for the brokers to compete for business if they don't offer Internet services,' Mr Sun said.

The SFC survey revealed that 14 per cent of investors found some aspects of the local market to have 'unfairness'.

These aspects included insider dealing, market manipulation by large investors, limited access to information for small investors, and insufficient transparency.

About 36 per cent of retail investors urged the SFC to strengthen supervision to improve the transparency of listed companies; 35 per cent wanted more enforcement against insider dealing.

About 22 per cent wanted tighter supervision of brokerage firms by the SFC, while 17 per cent wanted it to add measures to fight against market manipulation.

The SFC survey showed that 46 per cent of investors used brokers to trade stocks and the same percentage used banks, with 8 per cent using both.

It showed 20 per cent of all 2,273 respondents had traded in securities in the past three years.