Factors affecting consumers' stock ownership decisions in China.

摘要

The objective of this study was to identify the factors related to individual stock ownership behavior in China, as well to identify the market segments and profiles for individual investors in the Chinese stock market. This study was partially motivated by the rise in China's economy and financial markets, along with the rising consumer income over the last two decades, and the entry of China into the WTO in 2001.;Consumer survey data from individual investors was used in this study, and methods included ordered probit models, structural equation models, factor analysis, and cluster analysis. The probit model and the structural equation model results indicated that factors related to Chinese individual ownership of stocks may be categorized as three main factors: knowledge and behavior, investment benefits/objectives, and socio-demographics. Knowledge and behavior was found to be an important factor related to Chinese individual stock ownership, along with socio-demographics. The factor analysis and cluster analysis results showed that individual Chinese stock investors may be segmented into four major classes, which are mainly decided by their investment preferences, as well as their socio-demographics. Among the four clusters of Chinese individual stock owners, the older wealthy investors with higher net worth tend to be most likely to own stocks, and they prefer holding stocks for less than two years. The information from this study may be useful to help firms and policy makers better understand Chinese individual stock ownership decisions.