A total of 2.24 million small and individual investors returned to the Taiwan Stock Exchange (TWSE) last quarter, the highest number in the past 32 quarters, indicating that such investors are more passionate about local equities, analysts said.
It is the second-highest number ever, after the 2.32 million people who registered in the third quarter of 2011, according to the exchange, which defines small and individual investors as those who trade less than NT$100 million (US$3.26 million) in shares in a single quarter.
The rising number indicates that more people entered the market seeking targets with good returns, Hua Nan Securities Investment Management Co (華南投顧) chairman David Chu (儲祥生) said by telephone on Saturday last week.
“Small and individual investors favored fewer big-cap stocks such as Taiwan Semiconductor Manufacturing Co (台積電) and more small-cap stocks, which allowed them to make quick money in a single session,” Chu said. “Many of them were also focused on day trading.”
The anticipated rise in demand for 5G services has buoyed many stocks of 5G-related companies this year and gained the attention of individual investors, he said.
“You cannot analyze their investment behavior based on those of foreign investors or big players. After all, it is good returns that made small and individual investors wanted to return to the exchange,” Chu said.
However, their sheer numbers might also reflect the jitters in the market last quarter, Taishin Securities Investment Advisory Co (台新投顧) general manager Mason Li (李鎮宇) said by telephone.
As the TAIEX went through a volatile period last quarter, small and individual investors might have to trade more to hedge their risks, Li said.
On the other hand, some might have sold shares in August when the TAIEX plunged following US President Donald Trump’s decision to levy another 10 percent in tariffs on Chinese goods, but returned to the market last month to seek profits after the TAIEX rebounded to about 11,000 points, he said.
As the number of big players — who trade more than NT$500 million in shares in a single quarter — also grew by 1,115 last quarter, the TWSE’s total turnover reached NT$7.58 trillion, up 4.8 percent from NT$7.23 trillion in the previous quarter, exchange data showed.
The TAIEX yesterday closed up 44.85 points, or 0.41 percent, at 11,111.8 points, with a turnover of NT$130.903 billion, TWSE data showed.
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