China fact of the day

New brokerage accounts have surged since China’s bull market got running mid-2014. The number of new trading accounts hit a five-year high in early March. But as you can see in the chart above, a lot of those new investors probably aren’t the savviest.

Some 67.6% of households that opened new accounts in the past quarter haven’t graduated from high school, according Orlik’s chart, which comes from a large-scale quarterly national survey of household assets and income conducted by Gan Li of the Southwestern University of Finance and Economics. Only 12% have a college education. Among existing investors surveyed, only 25.5% lack a high school diploma; 40.3% have finished college.

From Gwynn Guilford, there is more here.

Comments

I believe this is a relevant article. People want to put their money to work for them, and the leadership of China have been preventing that.

http://www.economist.com/news/finance-and-economics/21601872-every-time-regulators-curb-one-form-non-bank-lending-another-begins

The Chinese I know love to gamble.

How do these education stats compare with the same stats for all of China?

Exactly the first question I had while reading - the answer's not mentioned in the article at all.

Stand alone "gotcha" stats like this are utterly worthless and seriously annoying.

For Chinese people who are today in their '30's and 40's it was practically impossible to get into high school, let alone into a college. College graduates are surely less than 2% among that age group.

The good news is, if they learn the term "index fund," they'll outperform 80% of the experts with their degrees.

And if they don't know the term "bubble", they will.

Huh, I guess Thiel got a little boring in the middle of the interview, so Tyler decided to do a bit of blogging.... :-)

The Chinese government needs to give up on trying to exert total control over its financial system.

By restricting free flow of capital, China has been building up bubbles in its real estate market (one of the few areas ordinary Chinese can actually invest their savings).

Any evidence that they'll underperform harvard MBAs? I tend to think that the issues of the market are so dense and unpredictable that the gap between an uneducated moron and the greatest investor on earth is tiny compared to the gap between both of them and the knowledge required to make money consistently above market on anything but luck.

My grandfather went to school for just one year and he did some investing and although he lost some real-estate investment in the great depression I do not think he did any worse that the average high school grad.

My great-grandfather's brother-in-law managed to do pretty well for himself in the Depression. He owned a business which he was able to keep going through the Depression and invested most of his profits in Coca-Cola stock. The rest of the story is left as an exercise for the reader.

Sugar water and caffeine. Couldn't get that in the 19th Century.

The previous post on education in Mao's China seems relevant.

The profiles more or less correspond to the young Chinese entrepreneurs http://www.chinadaily.com.cn/regional/2015-01/30/content_19451520.htm

"About 60 percent of the entrepreneurs in the research did not receive a higher education"

"bachelor degree: 12.2 %"

"associate degree: 27.5%"

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