Small local investors were still the main movers of the Philippine Stock Exchange (PSE) in the first-quarter this year, which the Department of Finance (DOF) attributed to the trust and confidence of the public in the regulatory institutions.
Based on a report submitted by the PSE to the Capital Market Development Council (CMDC), local retail investors had accounted for 74.3 percent of stock market transactions as of end-March this year.
In terms of volume, retail investors accounted for 43.3 percent of total, a significant jump from 18.2 percent in 2019 and 26.9 percent last year.
Foreign participation in the stock market, on the other hand, declined in the first three-months to 25.7 percent from 55.5 percent in 2019 and 45.4 percent in 2020.
Despite the sharp drop in the number of overseas investors, the average trading volume of the local bourse still rose by 49.6 percent last quarter, which PSE President Ramon Monzon said “indicating that local investors have stepped up.”
The year-to-date, average daily value turnover in the PSE was P11 billion, higher than the average of P7.35 billion last year, and the P7.29 billion in 2019.
Finance Secretary and CMDC Chairman Carlos G. Dominguez III said the increase in retail investor participation has pointed to the trust and confidence of the public in the regulatory bodies that are tasked to keep their capital and investment returns safe.
“Let’s keep that in mind—the environment of confidence in the system. Regulators are so important to provide guarantees to investors and ensure them that they are not going to be cheated,” Dominguez during a recent CMDC meeting.
In the local fixed-income market, investor-related trading has made up 59 percent of the total traded volume in January to March 2021.
The Philippine Dealing & Exchange Corp. reported that while the market performed slightly lower in the first quarter, investor-related trading made up P898 billion of the total volume of P1.5 trillion.
National Treasurer Rosalia de Leon attributed the growing number of retail investors in fixed-income securities to the measures that had been put in place to make bonds accessible to small investors.