世論 What Japan Thinks

goo Research recently carried out some research on the fallout from the “Livedoor Shock”, as it is being called in Japan, and Horie’s arrest. The research was carried out in conjunction with the Yomiuri Shimbun.

Just as background, when the story broke on the 16th of January, The Tokyo Stock Market Mothers Index in particular, within which many new IT firms are listed, fell around 22.4% over the following two days.

For this survey, 1,092 people (I believe they all owned shares) were questioned to see how they had felt the effects of the Livedoor Shock. Note that the survey was conducted on the 1st and 2nd of February, by which time the main TOPIX index had recovered all its losses, but as can be seen later, the personal investors were still hurting, suggesting that they were holding IT-heavy portfolios or other high-risk investments.

Q1: What effect has the Livedoor incident had on you? (Sample size=1,092)

Been aversely affected by selling shares whose price had dropped	16.8%
Sold shares, but not taken any losses	5.0%
Not sold shares that dropped in value, but have losses in my portfolio	25.7%
Not sold shares that dropped in value, but other share increases have negated the loss	21.3%
Just about no effect on the value of my portfolio	26.5%
Other	5.0%

Q2: Following the Livedoor incident, how will your share investments be in the future? (Sample size=1,092)

Investments will increase	8.4%
Investments will stay the same	80.7%
Investments will decrease	7.4%
Will quit share investing	2.0%
Other	1.5%

Q3: Do you do share dealing on the internet? (Sample size=1,092)

Every day (to SQ)	3.7%
One or more times per week (to SQ)	5.8%
One or more times per month (to SQ)	9.1%
Almost never	12.4%
Not at all	68.0%
Other	1.2%

Q3SQ: On average, how long until you sell shares that you buy? (Sample size=202)

Same day (day trading)	5.5%
Within one week	15.4%
Within one month	22.8%
Within three months	13.4%
Within six months	16.8%
Within one year	10.4%
Between one to three years later	11.9%
More than three years later	4.0%

Looking at the above chart broken down by ages, it can be seen that those in their twenties are the most active traders, with 11.8% usually selling the same day they buy, and almost three in five selling within a week. This compares with just one in four of those forty and over who take the short-term view of their investments.

Q4: What is the objective of your share dealings? (Sample size=1,092)

Portfolio shaping	34.2%
Earn living expenses	4.0%
Earn spending money	32.2%
Get rich quick	2.0%
Get shareholder perks	6.9%
Learn about the economy	8.9%
It’s a hobby	11.4%
Other	0.5%

Note that this question is geared towards finding out why transactions are taking place, not at the bigger picture of why they are investing in shares in the first place.

Looking at the age breakdown, 42.1% of those in their twenties said it was in order to earn extra spending money, whereas 53.3% of those in their fifties dealt in order to keep their portfolio in shape. For the retirees, a third said that their dealing was just a hobby, basically.

Q5: In your share dealings over the last year, about how much did you make or lose? (Sample size=1,092)

Over 5,000,000 yen profit	4.0%
3,000,000 to 5,000,000 yen profit	1.5%
1,000,000 to 3,000,000 yen profit	12.4%
500,000 to 1,000,000 yen profit	10.4%
300,000 to 500,000 yen profit	7.4%
100,000 to 300,000 yen profit	11.4%
Under 100,000 yen profit	24.8%
Under 100,000 yen loss	8.9%
100,000 to 300,000 yen loss	3.5%
300,000 to 500,000 yen loss	0.5%
500,000 to 1,000,000 yen loss	1.5%
1,000,000 to 3,000,000 yen loss	1.0%
3,000,000 to 5,000,000 yen loss	0.0%
Over 5,000,000 yen loss	0.0%
Don’t know	12.9%

Q6: About how much is your portfolio currently worth? (Sample size=1,092)

Up to 100,000 yen	11.9%
100,000 to 300,000 yen	15.8%
300,000 to 500,000 yen	7.9%
500,000 to 1,000,000 yen	13.4%
1,000,000 to 5,000,000 yen	35.6%
5,000,000 to 10,000,000 yen	8.4%
10,000,000 to 50,000,000 yen	5.9%
50,000,000 to 100,000,000 yen	0.5%
Over 100,000,000 yen	0.5%

Looking at the age breakdown, as might be expected, the older the respondents were, the more money they had in their investments. 6.7% of those in their fifties were dollar millionaires. The retirees had slightly less saved on average, which might reflect that they have to draw on their savings for living expenses or have passed money on to their children.

For the next question, as well as the 1,072 private individuals answering the questions, 104 companies were also surveyed.

Q7: What adverse effects do you see the Livedoor incident having on share prices? (Sample size=1,072+104 businesses)

	Personal N=1,072	Business N=104
As well as the effect on new IT businesses, all share prices will be affected	34.5%	4.8%
There will be an effect on new IT businesses’ share price, but general share prices will not be greatly affected	42.3%	43.3%
New IT businesses’ share price won’t be greatly affected, but general share prices will be affected	6.9%	0.0%
Neither new IT businesses’ nor general share prices will be greatly affected	15.3%	41.3%
Other	1.0%	10.6%

Q8: What effect do you think the Livedoor incident will have on the current M&A (Mergers and Acquisitions) boom? (Sample size=1,092)

A great effect, so M&As will decrease	10.4%
Some effect, so the pace of M&As will slow	56.0%
No effect, and M&As will continue to increase	32.4%
Other	1.2%

Q9: Do you think the the Financial Services Agency and the Tokyo Stock Market, etc, are performing the roles that are expected of them? (Sample size=1,092)

They are performing sufficiently well	1.6%
They are performing well to some degree	20.2%
They are not really performing well	56.0%
They are not performing well at all	21.8%
Other	0.6%