By Li Zengxin
Updated: 2007-08-03 16:30

Besides sfinancial shares, stocks in the real estate, mining and retail and wholesale sectors were particularly strong. Real estate developer China Vanke, the largest trader both in terms of trading volume and transaction value, gained 7.6 percent to 33.8 yuan to lift the Shenzhen index up. Beijing Air Port High-Tech Park rose 10 percent to pioneer the surges by reality shares.

Closed-end mutual funds listed on the exchanges were up, with both the indices rising over 2.5 percent. B shares finished mixed, with 44 out of the total 109 B shares gaining from higher prices today.

Recovering from a month and half-long sluggish performance since May 30, the stock market seemed to have started another round of surges to higher grounds recently, which largely brought back investor confidence. The new A share account opening returned to the above 100,000 level since last Monday and remained on that level. This Monday, it hit 163,451, the highest in a month.

In addition, a survey by the China Securities Association showed that 60 percent of investors are optimistic about the performance in the remaining months this year.

However, the survey also concluded that individual investors are inclined to make irrational decisions against their risk-aversion attitudes.

On one hand, over 60 percent of individual investors said they prefer long-term, stable returns and are tolerant to 20 percent loss at most. On the other side, however, more than half of the investors have mostly made short-run speculations by selling stocks in less than three months after purchase, implying their longing for faster and higher profit margins accompanied with higher risks.

Amateur investors are dwarfed in their investment scales. The survey found 70 percent of the personal investors have less than 500,000 yuan in their stock accounts, and one fourth of the total have less than 100,000 yuan.

It is also worth of noting that 70 percent of them use over one third of their family wealth in the stock market while 13.4 percent of the total put all their savings in the market. Of the "veteran" investors with more than a year experience, 8.3 percent borrow money from others or banks to invest in stocks; of the new comers, and 10.8 percent use borrowed funds.

Analysts believe the results showed that individual investors are vulnerable to stock price fluctuations for their lack of funds and knowledge about the market, risk awareness and control ability, and high proportions of personal wealth. The regulators must protect these investors at all cost, experts said. Strict regulation and close supervision over the market, more education to the individual investors, and establishment of investor protection schemes are among the many that are needed stress the problem, they believed.

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