To fully understand the basic information of individual investors, track the changes in investor structure and behavioral characteristics, and improve investor education services and protection in a more pertinent and effective way, SZSE organized the 10th survey on individual investors since 2009. The framework of the survey is similar to previous ones, mainly involving investor structure, educational level, risk preferences, concepts and behaviors, sentiment and expectation, etc. The survey also touches upon investors' opinions on 2019 risk factors in stock market and issues in the capital market.

The geographical distribution of securities accounts is taken into consideration, and stratified sampling is adopted. The respondents are aged 18 to 60, and have traded stocks in either SSE or SZSE in the past 12 months. A total of 24,074 respondents from 331 cities of different sizes nationwide have answered the questionnaires.

The results of the survey are as follows:

1. Asset allocation and investor structure: the percentage of household wealth kept in the stock market has decreased in 2018, so has the assets in their accounts on average, while the ratio of public funds holdings has increased. New investors in the market are mainly young.

In 2018, respondents invested 25.6% of household current assets in stocks, down by 2.4% compared with last year. Average assets in account are CNY445,000, down by CNY94,000. Holdings of public funds account for 37.2% on average, up by 3.5% compared with last year.

In terms of the amount of assets in their accounts, respondents (small and medium investors) keeping less than CNY500,000 account for 80%, and those keeping less than CNY100,000 account for 40.9%. In terms of ages, the mean age of respondents is 37.6, with those under 40 accounting for 60.3%. Most respondents have received higher education and above, accounting for 60.6%.

The majority of new investors in 2018 remain young, with an average age of 31.0. Those under 30 represent 56.2% of new comers.

2. Overall educational level continues to increase. The gap between investors in different regions in terms of educational level has narrowed, but the educational level of new investors remains low.

There is a significant boost in investor educational level in recent years. The average score of respondents in the knowledge test steadily rose from 57.6 points in 2014 to 71.1 points in 2018.

Among investors themselves, the average score of new market comers is 5.0 points less than that of all investors. Judging from different regions, the difference in the result of knowledge test between regions is narrowing. The highest score and lowest one between regions decreases from 6.2 points in 2014 to 3.2 points in 2018.

3. Risk preferences: there is a slight turn toward risk neutrality in terms of risk aversion. New and young investors are mostly risk pursuers, while risk preferences of large investors vary.

In terms of risk preferences of 2018 investors, risk evaders account for 43.1%, down by 4% compared with last year. Investors who are risk neutral represent 32.2%, up by 3.6%. Risk pursuers represent 24.7%, same as last year.

The percentage of risk pursuers in new investors and those under 25 is 1.6% and 5.2% higher than that in total investors who took the survey. There is a significant diverge in risk preferences of large investors keeping more than CNY5 million in their accounts. The percentage of risk pursuers among large investors is 8.2% higher than the average, and the percentage of risk evaders among large investors is 2.0% higher.

4. Investing concepts and behaviors: individual investors gradually embrace value investment, yet irrational investment still could be found.

The concept of value investment of individual investors is enhancing. In 2018, investors with the idea of value investment rise to 28.6%. Trend trading represents 25.9% and short-swing trading 19.0%.

Irrational investing is still common in the following aspects. High trading frequency. Investors trading several times within one week account for 46.4%, and those trading once or twice a month represent 31.9%. Those conducting more than one trading in a quarter represent 21.7%. Indifference to stop losses. 45.3% of the investors never use any strategies to cut losses. Irrational investment resulting from references and familiarity (Some investors believe that they could make money more easily by investing in the stocks they traded before than in other stocks), overconfidence, and disposal effect (Some hold that they are keeping the money-loosing stocks rather than the money-making ones) accounts for 57.6%, 43.8% and 39.0% respectively.

5. Investment loss and gain: there is no significant difference in investment concepts between those who gain and those who lose, but the former exercises value investment to a greater extent.

The comparative analysis on money-gainers and money-losers' objective difference tells that they do not showcase stark difference in knowledge level or investing concepts. However, their trading behaviors are in contrast. For example, among profit losers and gainers, the percentage of those having the stop-loss awareness is almost the same, being 38.8% and 38.7% respectively. In practice, however, 61.2% of the gainers clearly exercised the stop-loss strategy, which is 9.5% higher than those who did among the loss sufferers. The percentage of those who recognize the long-term value concept among the two camps is flat. But, with regard to the proportion of those who read listed companies' announcements and financial institutions' research reports, the gainers enjoy a lead of 8.8% and 5.1% over the sufferers respectively. Moreover, the gainers feature 4.4% and 9.4% lower in frequent trading and disposal effect than the loss sufferers.

6. Valuation and expectation: an increasing number of investors consider the current stock price low and investors tend to be cautious in judging the 2019 market trend.

In terms of the current stock price, 30.4% investors, 10.2% higher than last year, believe it is too low; 42.0% investors, 3.3% lower than last year, think it is reasonable; and 27.7% investors, 6.8% lower than last year, consider it is too high.

With regard to the 2019 market trend, investors' expectation tilts towards prudent on the whole. According to survey, 37.5%, 47.0% and 15.5% investors are inclined to be optimistic, neutral and pessimistic respectively, which is 1.5% shorter, 4.1% lower and 5.6% higher than the previous year respectively.

7. The ChiNext reform is highly anticipated. The ChiNext investors feature higher average asset scale, knowledge level and ratio of exercising the right of knowing than the non-ChiNext investors.

In terms of ChiNext reform, investors express high expectation towards "allowing the listing of enterprises that have the same share with different rights", "allowing the listing of enterprises that have not yet been profitable", "loosening the suitability requirements", "implementing the registration system" and "loosening the refinancing requirement". The support rates for these aspects are 54.8%, 54.3%, 52.6%, 52.4% and 48.1%respectively.

The survey show that ChiNext investors' average account asset amount is CNY529,000, far higher than the non-ChiNext's CNY331,000. In the aspect of investment knowledge, ChiNext investors score 72.7 points, 3.8 points greater than the non-ChiNext. Also, ChiNext investors manifest stronger awareness of shareholders' rights and their ratios of right to know and right to exercise are 41.3% and 19.1% respectively, which are 7.7% and 2.6% higher than the non-ChiNext.

8. Investor protection measures are recognized. In particular, strict implementation of forced delisting system, establishment of "blacklist" system of law violators and dishonesty, and trading suspension/resumption system reform are the most recognized among investors. 

More than half of the investors approved of the many investor protection measures taken by regulators in 2018. Among the measures, three of them were spoken most highly, i.e. the "strict delisting system" (55.7% approval), the "system of establishing a blacklist of law violators and dishonesty" (55.4% approval) and the "reform implementation of the stock suspension/resumption system" (55.1% approval).

9. Investors pay high attention to risk factors such as financial deleveraging and Sino-US trade friction, and hold different expectations for the evolution of various risk factors.

For risk factors that may affect the stock market operation, investors' attention is ranked as follows: financial deleveraging (67.3%), monetary fiscal policy adjustment (65.7%), stock pledge of listed companies (65.5%), overall performance of listed companies (63.7%), Sino-US trade friction (63.6%), good-will impairment of listed companies (60.9%), Fed's rate hike process (60.2%), and macroeconomic situation (56.8%).

For the evolution of various risk factors, investors hold different expectations and believe that "goodwill impairment of listed companies", "stock pledge of listed companies" and "Fed's rate hike process" will have a negative impact on the market, while "monetary fiscal policy adjustment", "Sino-US trade friction", "financial deleveraging" and "macroeconomic situation" will lead to positive changes.