Japanese retail investors act differently depending on their loyalty to companies

what happened

Sumitomo Mitsui Trust Bank, the largest transfer agent in Japan, surveyed about 130,000 individuals holding shares in its client companies. Respondents used its Shareholder Passport app, with the online questionnaire run from August to September, and the results were published on Friday. According to Dow Jones Newswires, citing the Yomiuri Shimbun, this is the bank's first large-scale study of individual shareholders. The most common objective was stable dividend income, named by 35% of respondents, followed by growth-oriented companies at 16% and shareholder perks at 15%.

The survey rated fandom on a 10-point scale. Among the most loyal holders, 91% trust management and 82% vote at every shareholder meeting, against 65% of casual fans. Most respondents also asked companies for clearer and more timely disclosures.

Individual investors are becoming a bigger force in Japan's stock market. According to the Tokyo Stock Exchange, their holdings in individual companies reached 91.98 million at the end of March, up 8.39 million from a year earlier and a record for a twelfth straight year.

why it matters

For markets, the findings matter because Japanese companies are reducing cross-shareholding and counting on individuals as steady long-term owners. Loyal holders could dampen share price swings, but registries give firms only limited data on who their shareholders are, so the effect is hard to measure for now.

tags

instruments