The number of stock market accounts at the Philippine Stock Exchange (PSE) increased to 2.86 million in 2024, representing a 50.1 percent rise from 1.91 million in 2023.

This sharp rise, according to PSE president and CEO Ramon Monzon, was fueled by a 62 percent surge in online accounts, which grew from 1.53 million to 2.47 million, the highest jump recorded since the exchange began tracking investor profiles in 2008.

The increase is mainly attributed to enhanced digital connectivity. Platforms such as PSE EASy and the upgraded PSE EASy mobile app, which enable local small investors to subscribe and pay for initial and follow-on public offerings, are making investing more accessible. Meanwhile, PSE EQUIP now offers a premium subscription model that allows access to real-time market data.

While the gains are impressive in terms of absolute growth, a closer look at the broader picture reveals a more sobering reality.

Despite nearly tripling the number of accounts over the past few years, only about 2.5 percent of the Philippine population, based on the estimated national population of 113 million, has a trading account. This figure underscores the relatively shallow depth of the country’s capital market, particularly when compared with neighboring ASEAN economies.

15% Malaysian investors

In contrast, Malaysia, according to data from Bursa Malaysia and the Securities Commission Malaysia, has over 5 million Central Depository System (CDS) accounts, representing about 15 percent of its roughly 34 million population.

Thailand, based on statistics from the Stock Exchange of Thailand (SET), has over 6 million retail investor accounts, covering an estimated 8.5 percent of its citizens.

Indonesia, the largest country in the region by population, had already surpassed 11 million individual investor accounts by the end of 2023, based on records from the Indonesia Stock Exchange (IDX), with market penetration nearing 4 percent, nearly double the Philippines’ rate.

Vietnam, too, is making significant strides, with over 7 million stock trading accounts by the end of 2023, equivalent to approximately 7 percent of its population, according to the State Securities Commission of Vietnam.

The disparity is stark. Despite the promising rise in account openings, Filipinos remain relatively underrepresented in their own capital market. PSE data further shows that only 16 percent of total market turnover comes from retail investors, suggesting that most of these new account holders remain passive participants.

Market becomes inclusive

Still, there are encouraging signs of inclusivity. Women now slightly outnumber men among investors, comprising 50.7 percent of total account holders. The bulk of investors come from the 30 to 44 age group, who hold 48.8 percent of all accounts and 51.6 percent of online accounts. Young Filipinos between 18 and 29 years old are also increasingly active, growing their share to 26.5 percent of total accounts from 19.5 percent the previous year.

In terms of geographic spread, the number of investors outside Metro Manila is rising. Its share of accounts has fallen to 49.3 percent from 68.2 percent as more account holders now come from Luzon, Visayas and Mindanao.

However, most Filipino investors continue to invest modestly. Over 82 percent of retail account holders earn less than P500,000 annually, indicating that the average Filipino investor still enters the market with relatively limited capital.

Meanwhile, the share of investors earning more than P1 million annually has dropped to just under 11 percent.

To encourage deeper participation, the government recently enacted Republic Act 12214 or the Capital Markets Efficiency Promotion Act.

Among its key provisions is the reduction of the stock transaction tax (STT) from 0.6 percent to 0.1 percent — a measure widely welcomed by market participants and aimed at lowering barriers to entry and encouraging more active trading.

“We are optimistic that the upcoming reduction in stock transaction tax, along with our investor education initiatives and an upcoming pipeline of new products, will spur greater activity in the market,” Monzon said.