Bring back the retail investors

IT has always been a challenge for the authorities to cultivate and maintain vibrant retail participation in the local stock market. Traditional approaches have centred around education and disclosure, based on the assumptions that: a) retail investors are relatively unsophisticated and b) that institutions typically possess unfair technological and economies of scale advantages over small players and that the playing field can be levelled through enhanced disclosure.

Over the years, this strategy has yielded mixed results. Retail involvement has been patchy and subject to booms and busts, the former usually in low-priced issues and the latter, when they occur, hurting confidence and leading to retai…