Commission-Free Stock Trading and Impact on Individual Stock Market Participation (SMP)
Date of Award
Doctor of Business Administration (DBA)
This research explores the impact of zero-commission stock trading on individual stock market participation across a spectrum of demographic and socioeconomic factors. The advent of online platforms offering commission-free trades has potentially democratized stock market access, which this study investigates against the backdrop of traditionally low individual engagement in stock investments. The research was a quantitative cross-sectional survey, collecting data from a diverse American demographic. A significant 41% response rate was achieved, resulting in the completion of 495 questionnaires. The analysis reveals that income is the dominant factor influencing stock market involvement, accounting for 21% of the variance in participation rates; higher earners are more likely to invest. The allure of zero-commission trading stands out as a strong predictor of SMP accounting for 15% variance in participation while widespread adoption of smartphones and trading apps accounting for (4%). Financial knowledge and awareness was equally a significant predictor, contributing to 6% variation in SMP. Additionally, gender and age accounted for 3% and 4% variance respectively. The research underscores critical areas for policy and educational interventions, such as increasing financial literacy to bridge the gender gap and extending market access to lower-income groups. By shedding light on these factors, the study provides a comprehensive understanding of the recent shifts in stock market participation dynamics, highlighting the transformative potential of zero-commission trading in an increasingly digital financial landscape.
Otchere, Augustine Akomeah, "Commission-Free Stock Trading and Impact on Individual Stock Market Participation (SMP)" (2023). All Doctoral Student Dissertations. 127.