NUR-SULTAN – The world has seen a sudden increase in the numbers of retail investors amid the pandemic and Kazakhstan has followed a similar trend. The growth rate of new accounts has doubled, reaching 4.5 percent in the first seven months of 2020 as compared to the same period in 2019, the Kazakhstan Stock Exchange (KASE) press service told The Astana Times.
As of Aug. 1, the Kazakh Central Securities Depository had 123,278 accounts in total. Over the past five years, the number of accounts has increased by 17.7 percent.
Retail investors in Kazakhstan made up only 1.4 percent of the population at the end of March 2020, and 1.3 percent in 2019. KASE said that although this increase did not “fundamentally change the situation with retail investment in the country,” the positive growth is “clearly visible.”
Kazakh citizens mainly use more conservative means of investment as deposits, pensions and real estate. The pandemic has pushed more people to seek alternative and more profitable investment instruments. According to KASE, there are factors to consider such as the decrease in the rate on bank deposits, the fall in prices of assets in March after the stock market downturn, and more importantly the availability of more free time.
“Many took online courses to study the basics of investing from brokers, improved their financial literacy, and studied the mechanisms of the organized stock market. After mastering the theory, some citizens took action and opened a brokerage account to trade,” said KASE.
Financial consultant and FinMentor co-founder Arman Batayev also stressed the growing interest in FinMentor financial literacy courses this year.
“As a service provider of financial literacy, I can say that the interest in our courses has increased. The vast majority, however, goes directly to foreign brokerage companies,” Batayev spoke to The Astana Times.
Batayev also stressed that more free time was the main factor in the increase of individual investors.
“The pandemic increased interest. People were forced to sit at home and they needed to occupy themselves with something,” he said. “People either start to play games or start to trade and invest in stock markets.”
“Buying and selling shares is very easy. But a person really needs to analyze many reports and learn about an instrument that he or she wants to invest in. Investing, thus, becomes a sort of a hobby. It distracts and fills the free time,” Batayev explained.