Most stock traders foreigners: Exchange
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More than half the people who trade stocks on the Lao Securities Exchange are foreigners, even though the government has restricted their right to own shares in listed companies.
The annual report published by the stock market said 58 per cent of people trading on the Lao Securities Exchange in 2012 were foreigners, while 29 per cent were Laotians and 9.9 per cent were corporations.
Institutional investors comprised 0.18 per cent of the total number of traders, while 2 per cent of investors were not classified. The main foreigners trading on the Lao stock market in 2012 were from China, Thailand, Japan, Korea, Vietnam and the US.
The government has limited the number of foreign shareholders due to fears that rapid inflows and outflows of foreign currency would have a negative impact on currency management.
Lao people are also restricted in the number of shares they can own, so they tend not to buy and sell stocks to make a profit as foreigners do. Most Lao investors buy shares with a view to long-term savings and the dividend they will receive from the two listed companies.
One of the reasons why Lao investors are relatively inactive compared to foreign investors is because for them stock investment is a new area of business, and they feel the need to learn more before making decisions on trades.
