‘Confidence problem’: why Hongkongers feel less investment-savvy than Singaporeans

Despite showing the highest rates of investment participation, Hongkongers feel less knowledgeable about their investment decisions than international peers, with the younger generation in particular facing a “confidence problem”, a recent study finds.

Some 88 per cent of Hong Kong respondents said they invested in some form, and yet 41 per cent felt they were held back by a lack of knowledge, according to the “Lifetime of Investing” study commissioned by Syfe, a digital investment platform, and conducted by YouGov, a market research firm.

The study surveyed a total of 3,315 adults across Hong Kong, Singapore and Australia.

By comparison, only 77 and 61 per cent of respondents in Singapore and Australia, respectively, said they invested in some form – but far fewer respondents said they were held back by a lack of knowledge.

“Hong Kong does not have an investment ambition problem, it has an investment confidence and knowledge problem,” said Jack Prickett, group chief commercial officer and head of Syfe Hong Kong.

“That means making risk, diversification and long-term investing easier to understand, rather than simply encouraging people to invest more,” he said.

Young Hongkongers in particular faced a confidence problem, according to the study. Only 17 per cent of Hong Kong respondents aged 25 to 34 said they were extremely or very confident making investment decisions. That number was double in Singapore.

Although 63 per cent of Hongkongers in this age group said they would like to invest more, over half said their fear of losing money posed a barrier.

“Many [youngsters] started investing in the last few years, a difficult stretch for Hong Kong’s local market,” said Prickett about the comparatively low confidence levels among the city’s younger generation. “When you’re new, every dip feels personal.”

By contrast, 41 per cent of Hong Kong’s generation above the age of 55 reported high confidence levels in their investing decisions – the highest of any generation in the city and higher than peers in Singapore and Australia.

The study presented a reverse generational picture for Singapore, where investment confidence was highest for the youngest age group and fell gradually with age.

For middle-aged Hongkongers, not having enough money was a significant barrier to investing for half of those supporting their parents financially.

“Our data shows why investing cannot be separated from real life,” said Prickett, pointing to the competing demands between family commitments and long-term financial security.

Only 29 per cent of Hongkongers aged 35 to 54 who supported their parents financially said they had a retirement plan, compared to 44 per cent of those who did not support their parents financially.

Prickett said Hongkongers with a retirement plan were almost three times as likely to feel confident making investment decisions as those without one. “Confidence usually comes from understanding what you own and why, not from picking the right stock.” -- SOUTH CHINA MORNING POST