Many individual investors in Chinese stocks have called it a day after having lost faith in the market. Last year more than two-thirds of the active accounts of individual investors were sleeping accounts, because they had not registered any transaction. With increasing numbers of individual investors exiting, the stock market is now entering a new period in which institutional investors start to dominate the market. This seems inevitable as China's stock market matures.

Individual investors' passion for stocks was at its height five years ago when they accounted for more than 95 percent of all stock accounts. But after the stock index reached a peak of 6124 in October 2007, it took just one year for it to drop to 1664. Although the index rebounded to 3478 in September 2009, the activities of individual investors have been subdued since then.

Because individual investor's activities have more or less died down over the last five years, the capital inflow into the stock market has suffered. The serious losses they have incurred, along with the continued downward trend of the stocks, means individual investors have no intention of venturing further into the stock market. Thus large accounts have shrunk and even been closed.