Factors That Influence Retail Equity Investors to Patronize Islamic Stockbroking in Malaysia

Abstract

This study investigates factors that influence retail equity investors to patronize Islamic stockbroking in Malaysia and ranks their level of importance using Analytical Hierarchy Process. Data are collected using questionnaire via online and offline survey among clients, individuals who work in the stockbroking industry and stockbroking related industry such as fund managers, unit trust managers, and mutual funds. The results show that religiosity and product awareness significantly influence the patronizing behavior of Malaysian retail equity investors. On the other hand, economic motives, convenience, social influence, and attractiveness of stock investment ranked below religiosity and product awareness. In view of the findings, stockbroking industry players such as investment bank, stockbroking firm, or participating organization should take advantage of the religiosity and product awareness factors as a main focus to develop Islamic stockbroking service in Malaysia. Sales, marketing and business development strategies can be designed according to the said criteria.