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2004 Australian Share Ownership Study

More Australians are share owners than ever before, according to the 2004 ASX Share Ownership Study.   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 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 Study measures three categories of shareowner:

  • Direct share ownership only - 23 percent.  Direct share ownership includes shares you hold 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 (self-managed) 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.

Those holding the shares directly (i.e. direct share ownership only, plus a combination of direct and indirect), amount to 44 percent of the population, up from 39 percent in 2003.  We believe that this is the highest reported level of retail share ownership in the world. 

Growth was recorded across all measures including gender, age, level of education and income brackets.  Additionally, this year for the first time regional investors have been as numerous as those in cities.  Growth was also stronger from those earning less than $50 thousand per year, and those with a trade certificate or Year 12 level of education as their highest level. 

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.

Investors are also trading more regularly than in previous years 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.

Further information can be found on the ASX website

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