Thai online stock trading surges, trumps Hong Kong in popularity

By Viparat Jantraprap

BANGKOK(Reuters) - GRAPHIC: Thai stock transactions: http://link.reuters.com/suk44w

Thailand's military rulers may have thrown a fence around online politics. But in high finance, cyberspace remains unfettered. Internet stock trading has tripled in value as use of mobile devices proliferates among young, tech-savvy retail investors.

Online retail trading surged 239 percent to 1 trillion baht (21 billion pounds) in February from a year earlier, the latest available data from the stock exchange shows. That was the biggest increase since March 2010. Those transactions account for over 40 percent of total trading volumes, up from 27 percent in 2012. That ratio exceeds even Hong Kong, where retail online trading accounted for 9 percent of total market turnover in the year ended September 2014.

Transaction volumes have increased as retail investors, which brokers say account for over 90 percent of online trading, returned to the markets after months of anti-government protests which culminated in a military coup on May 22 last year. The benchmark SET Index has risen 8.4 percent since the military uprising.

The popularity of online trading is also due to a lower commission fee - 0.20 percent of transaction value versus 0.25 percent in conventional, offline trading. The stock exchange's launch of a trading app compatible with Apple's iPhone in 2009 and a second app in 2011 that makes use of the iPad's wider screen display have also helped drive growth. There are other trading apps on Google's Android platform, but they are less popular, brokers say.

"We expect the use of online trading platforms to increase because of the tech savvy users and the technology," said Boontip Kritchaikul, deputy managing director of Bangkok-based brokerage SCB Securities. "In terms of the contribution of online trading to total market trading value, we expect it to hit a ceiling of 55 percent by 2020."

(Editing by Ryan Woo)