Why few indians invest in stock markets

Why few indians invest in stock markets

Why few indians invest in stock markets

Friends Indian stock markets have been on an upside from last couple of years, infact last year nifty made its lifetime high but we see still the number of Indians investing in stock markets are not satisfactory.

Friends the stats that I'm going to present you, will leave you shocked, the percentage of Indians investing in stock markets is only around 3% whereas in China around 10% of population invests in stock markets and talking about USA around 18% of population invests in stock markets.

So comparatively INDIA is far behind, so today in this post I'm going to tell you the reasons why few Indians invest in stock markets.

1. Unawareness.

Friends, the first thing that keep people away from stock markets is the lack of awareness.

They don't know what is stock markets, what are shares, which platform to use for buying and selling of equities.

As a result they think its better to stay away from stock markets.

I know atleast a couple of people who work in financial sector, but still have no clue about stockmarkets.

2. Myths about stockmarkets.

Myths about stockmarkets keep people away from it.

Some of the common myths are.

* investing in stocks is like gambling.

* you need lakhs of rupees to start with investing in stock markets.

* investing by your own can be risky.

* there is no guarantee of safety of capital then why take risks.

3. Traditional methods of savings.

Friends another reason why few indians invest in stock markets is the existence of traditional saving and investment plans.

Many would be more than happy with their 4% returns from saving plans instead of investing in stock markets.

The reasons they give is these plans are safe and has no risks involved and are easy to understand.

4. Lack of information.

Friends then there are few groups of people who actually want to invest in stockmarket, but don't know how to start with, which platform to choose etc.

Also they don't get proper guidance, which leaves them discouraged as a result they never invest in stock markets.

5. Past scams.

Friends there have been instances in the past where common investors were duped of their hard earned money like Ketan parekh episode, satyam scam, harshad Mehta scam as a result many people still fear to enter into stock markets.

Though sebi is taking full cautionary steps, but a possibility of such future scam cannot be ruled out.

6. Poverty.

In INDIA still a substantial percentage of population lives below poverty line.

So where people don't have enough resources to fulfill their basic needs, how they will save and how will they invest?

So poverty is one big reason why few indians invest in stock markets.

7. Unwillingness.

Friends then there a group of people ( I hate them ) who know about stockmarkets, power of compounding, equities, mutual funds etc, but then to are not willing to invest.

The evergreen excuse they give is I don't have time.

They will procrastinate and keep on postponing their investing for tomorrow and alas for most of them, that tomorrow doesn't come.

8. Inclination towards gold/ reality.

Friends one big reason why few indians invest in stock markets is their inclination towards other assets like gold and property.

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