China’s ‘silver-haired’ investors exit the game with no one waiting in the wings

However, others said, young people today have more options for investment as well as leisure, which may serve as a partial explanation for their disinterest in stocks.

Recalling his decision to enter the stock market in the 2000s, He Zhi, a retired civil servant from Guangdong province, said: “I was not busy at work, and I had plenty of time after work. There were not as many pastimes as we have now, so I opened a stock account after it became a hot topic among my friends and relatives.”

Danny Liu, a 28-year-old software engineer in Shanghai, has made sure to stay away from the stock market as “even professionals can’t make money out of it”. He has instead embraced professionally managed funds, as have many others his age.

“Their returns have dropped as well, but at least I won’t lose my initial investment, so I sleep soundly at night,” he said. “If I have spare time, I’d rather spend it playing online games.”

Qian Qimin, chief analyst at the research arm of Shenwan Hongyuan Securities, said fewer individual investors could be a good thing for the market.

“In fact, young people are indirectly involved in the stock market as they invest in funds,” Qian said. “Let professionals do what they specialise in – it’s a process of de-individualisation of investing, which is a trend in line with Hong Kong as well as the United States.

“The young people I know, at least, rarely pick stocks themselves,” he said. “The more small investors a market has, the less efficient it is.”

He also discouraged elderly people from trading stocks, as many tend to be unfamiliar with emerging industries like technology.

Older Chinese investors have shown relatively low financial literacy compared with young adults, according to another report on financial literacy published by the SAIF and Charles Schwab last year. Those older than 65 scored 53.7 on a 100-point test, compared with an average score of 64.4 among all age groups.

Zhao Xijun, a finance professor with Renmin University, said while the number of individual investor accounts may not nosedive immediately, their proportional share value is falling. Greater domination from institutional investors “will have great implications”, he noted, “as they are playing a bigger role in maintaining market stability.

“It also means that if we want better performance from the market, it’s not just about better competitiveness from listed companies, but also (management and supervision of) institutional investors.”

Li, the Zhejiang retiree, said his decades of dedication to the stock market never fulfilled his dreams of fortune, despite an abiding nostalgia.

“After I gained a sum, I always gave it back,” he said.

“It’s really just a game.”

This article was first published on SCMP.