International Journal of Disaster Recovery and Business Continuity

Vol. 11, No. 1, (2020), pp. 896-901

The Game Changer: Perception of Traders towards Online
Trading and Traditional Trading

Dr.J.D.Aarthi Dhakshana*1, Dr.V.Krishnapriya2, Dr.K.V.R.Rajandran3

1
Assistant Professor, Department of Management Studies, Periyar Maniammai
Institute of Science & Technology, Thanjavur
2
Associate Professor, Department of Management Studies, Sathyabama Institute
of Science & Technology, Chennai
3
Associate Professor, Department of Management Studies, Periyar Maniammai
Institute of Science & Technology, Thanjavur
1
aarthi@pmu.edu, 2priyasathy21@gmail.com 3kvrrajan@pmu.edu

Abstract
Traditional were the big assets of the country. A huge part of Indian economy is in the
hand of traders and investors. The trading may take place through several methods. The
method was mainly classified into two ways traditional trading and online trading. Now a
days, Online Trading is an emanate tool of traders for trading. Moreover, online trading
creates more opportunities for traders and investors. A trader perceptive on online
trading is a significant game-changing backdrop of the financial sector. The purpose of
the research is to examine the trader’s perception difference of online trading and
traditional trading. The study also focused on the reason behind choosing the online
trading by traders. The researcher used the stratified sampling technique. 112 stock
investors from Thanjavur districts were selected for this study. The researcher used the
Mann-Whitney U & Wilcoxon W signed-rank test and regression statistical tools to
evaluate the data. This research would be a great support to the financial service
companies to understand the trader’s perception towards traditional trading and online
trading and also to assist them to be successful in their business.

Keywords: Online, Perception, Traditional, Trading.

1. Introduction
The traders make the country economic, very efficiency. Trader holds the stock for a
short period and stays up to its reach the high performance. Further, gamblers (Traders)
price the stock higher and sell their stock even in a day. Moreover, Trading is the skill of
timing the market and it is an art of investment. Before online trading, the traders used to
trade in traditional way by offline trading. The traders place the trading through brokers.
The brokers plays an intermediate role, they insist the traders to buy the stock. Many
traders were unaware of trading and they go blindly with the broker’s option. The trader’s
trading account also managed by the brokers. As a whole the trader’s fully depends on the
brokers. But, after the big revolution of Information Technology trader goes with the
online trading with lot of benefits. Even, the cost of online trading is cheaper than the

*1Dr.J.D.Aarthi Dhakshana., Assistant Professor, Department of Management Studies, Periyar Maniammai

Institute of Science & Technology, Thanjavur. aarthi@pmu.edu
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 International Journal of Disaster Recovery and Business Continuity
Vol. 11, No. 1, (2020), pp. 896-901
offline trading. However, some traders would still follow the traditional trading as they do
not believe that the online trading is safe. Therefore, it is very delightful to note that the
traders perception towards online and traditional trading.

2. Literature Review
Oh, Parwada and Walter (2007) studied the trader’s performance and behavior investor’s
online and offline trading in Korea. The researcher found that the investment through the
online trading investor able to understand the competition of financial corporate and they
found the online trading is in cheap of cost.

George analysed the online stock trading. The researcher stated that online trading creates
more impact among the investors. Further, the researcher argued that Internet trading
provides the up-to-date clear market information and high speed of trading. Hoffman et al
(1997) described that the online trading is another platform for the investors to make
better trading. The online trading avoids the middlemen intermission and provided better
channel of communication with financial services and traders.

Petric (2015) did research on online and traditional trading benefits and drawback in
Oradea. The researcher conclude that the traders had high knowledge of stock market and
good knowledge to access of internet were followed the online trading system. The
researcher revealed that the education background plays important role in online trading.
The study results showed that degree holders only accessed the online trading. Further,
the study found that the traders were attracted by the online trading due to low transaction
cost. Jobman et al., (2003) studied about the online trader and stock brokers. The research
found that traders adapt online trading because of speedy response and they believe that
online trading is the best option due to high volatility of stock.

Arshia (2018) analysed that the problems of online trading in Himachal Pradesh. The
researcher stated that some of the traders thought that the traditional trading system was
safer than the online trading. Thus the various researches were conducted on online and
offline trading system. This study also does the same and compares these trading systems
and its perception among traders.

Methodology
3.1 Research Objectives

(i) To analyze the difference between traditional traders perceptions and online
traders perceptions
(ii) To measure the online traders perception towards trading.

3.2 Hypothesis Statement

(i) H0: The online and traditional trader’s perception were same
H1: The online and traditional trader’s perception were different
(ii) H0 : There is no impact on online trader’s perception towards online trading
H1: There is an impact on online trader’s perception towards online trading

3.3 Research Design

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Copyright ⓒ 2020 SERSC
 International Journal of Disaster Recovery and Business Continuity
Vol. 11, No. 1, (2020), pp. 896-901
The research used both the quantitative and qualitative data. The researcher adapted
both primary and secondary data. The primary data collected from Traders. The purposive
sampling technique was followed in the research. The randomly the data collected from
81 traditional trader and 81 online traders. Therefore, totally the sample size were
gathered from 162 traders as respondents. The secondary data collected gathered from
journal, research paper and websites. The researcher used structured questionnaire as tool.
The questions were framed with five point Likert scale. The data were unpaired samples.
The Mann-Whitney and Wilcoxon analysis and Multiple Regression statistical tools were
used to evaluate the primary data using SPSS IBM 20 data packages

3.4 The Variables used in the Study

(i) Dependent Variables - Traditional Traders Perception, Online Traders Perception

were the dependent variables used in the study.
(ii) Independent Variables - Easy to access, Information Updates, Global Market,
Products Diversity, Power of Control, Economically cheaper, Easy to Monitor
Daily activities, More Trust.

3.5 Data Reliability

The primary data were gone through reliability test. According to Nunnally (1978) the
considerable alpha value is more than 0.5. Therefore the primary data of this research is
0.876, hence the data is very reliable and the data is fit for the analysis.

4. Finding and Discussion

4.1 Mann-Whitney U and Wilcoxon W

Table 4.1.1 The Mann-Whitney Test mean values of Traders

Ranks
Traders N Mean Average Sum of
Rank Rank Ranks
Easy to Access 2.08
Online 81 80.46 6517.5
Traditional 81 82.54 6685.5
Total 162
Information Updates Online 81 85.1 7.2 6893.5
Traditional 81 77.9 6309.5
Total 162
Global Market Online 81 84.43 6.39 6838.5
Traditional 81 78.57 6364.5
Total 162
Products Diversity Online 81 81.96 3.39 6639
Traditional 81 78.57 6364.5
Total 162
Power of Control Online 81 84.38 5.76 6835
Traditional 81 78.62 6368
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Total 162
Economically Cheaper Online 81 80.34 2.32 6507.5
Traditional 81 82.66 6695.5
Total 162
Easy to Monitor Daily 3.98
Activities Online 81 83.49 6762.5
Traditional 81 79.51 6440.5
Total 162
More Trust Online 81 81.4 2.78 6593
Traditional 81 78.62 6368
Total 162

Table 4.1.1 shows the results of the Mann-Whitney and Wilcoxon analysis of the
trader’s perception. The column average ranks exposed adjust for differences in the
traditional traders and the online traders. The tables reveals that among the groups the
Information updates had highest mean, compare to other variables. Further, the result
shows that information updates had more difference among the group. Here the group1
represent the traditional traders and group 2 represents the online traders.

Table 4.1.2 Test Statistics of Mann-Whitney U and Wilcoxon W

Test Statistics
Easy to Inform Global Produ Power Econo Easy to More
Access ation Market cts of micall Monitor Trust
Update Divers Contr y Daily
s ity ol Activiti
es
Mann-
Whitne 3196.5 2988.5 3043.5 3243 3047 3186.5 3119.5 3272
yU
Wilcox
6517.5 6309.5 6364.5 6564 6368 6507.5 6440.5 6593
on W
Z -1.198 -1.199 -2.019 -2.340 -2.764 -2.445 -2.221 -2.189
Asymp.
Sig. (2- 0.02 0.014 0.031 0.017 0.044 0.051 0.024 0.043
tailed)
a. Grouping Variable: Traders (Traditional Traders and Online Traders)

The table 4.1.2 data shows that easy to access in the online traders group
(W=6517.000) was statistically, significantly differ and was higher than the traditional
traders group (U= 3196.500) with z value of -0.191 and p= 0.02 was lower than the
standard p value. Similarly Information updates( W=6309.000; U= 2988.500; z value = -
1.001; p= 0.014), the Global Market (W = 6364.000; U = 3043.500; z = -1.198; p= 0.031),
Products Diversity (W = 6564.000; U = 3243.500; z = -0.894; p= 0.017), Power of
Control (W = 6368.000; U = 3047.000; z = -0.764; p= 0.044), Economically cheaper (W
= 6507.500; U = 3186.500; z = -0.045; p= 0.051), Easy to Monitor Daily Activities (W =
6440.500; U = 3119.500; z = -0.221; p= 0.024) and more trust were (W = 6593.000; U =
3272.000; z = -0.189; p= 0.043). The result reveals that all the independent variables of
(W) was statistically, significantly differ and was greater than the (U) and the significant

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 International Journal of Disaster Recovery and Business Continuity
Vol. 11, No. 1, (2020), pp. 896-901
values were less that the p value 0.05. The Z-Score is conversion static of the Mann-
Whitney U and Wilcoxon W. Z score be compared against the critical value of normal
distribution. The table 4.2 expose that the z score value. The z score should be 1.96. The
test statistic shows that all the independent variables have more than the 1.96 z score.

4.2 Multiple Regressions

Equation: Online Trading =0.612+ 0.517 (easy to access) + 0.634 (information

updates) + 0.425 (global market) + 0.521 (products diversity) +0.511 (power of control) +
0.490 (easy to monitor daily activities)

Model Summary: The regression model summary indicates the R value, R square,
Adjusted R square and standard error of the estimate. The R square value is 0.942. The R
values indicates that the 97% of traders perception has impact on online trading with the
standard error estimate value of 0.193.

Anova: The regression analysis also explores the Anova result to test the model fitness
of the regression. The significance value of the Anova is .000** which is less than the P-
Value 0.01. Further, the F value is 307.816 which indicate that the predictor’s
independent variables (Traders Perception) have strong prediction over the dependent
variable (Online Trading).

Coefficient: The regression analysis exposes the coefficient result of predictors on

dependent variable. The un-standardized co-efficient values explore how the dependent
variables differ from independent variable. The predictors value of easy to access
(B=0.517) show that this factor causes 51.7% change in online trading (DV). The
coefficient of information updates is (B = 0.634) it indicates that information updates
increase 63.4% in improvement in online trading. The Global Market coefficient (B =
0.425) is 42.5% changes in online trading. Likewise Products Diversity (B = 0.521),
Power of Control (B = 0.511), Easy to monitor daily activities (B = 0.490) has impact on
dependent variables with 0.011, 0.041, 0.051, 0.067, 0.059 and 0.063 P-value
respectively. The predictor of economically cheaper and more trust has significance value
of 0.278, 0.514 respectively which has more than p-value 0.05.

5. Conclusion
The study focused the online trader’s and traditional trader’s perception. The research
result proved that the perception of traditional and online traders had more difference. The
researcher compared the perception of both traders with Mann-Whitney U and Wilcoxon
statistics method. The result revealed that all the variables of z scores were greater than
the critical value 1.96 with negative rank and that this value is significant at < p
value. Hence, the H0 should be rejected and the alternative hypotheses were
accepted. In addition, the result clearly explained that there is a difference among
the perception of the online and traditional traders. Further, the researcher
measures the impact of perceptions towards online trading. The result reveals that
the information updates has the highest impact on online trading. The online
traders believe that through online trading they can obtain up to date information
about trading. Thus the study concludes that currently more traders renovate their
trading method to online in Thanjavur District. The stock trading merchants have
to give more importance to their trading website and to concentrate on the
information updates. Moreover, the traders adapt on digitalized economy. As a

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ISSN: 2005-4289 IJDRBC
Copyright ⓒ 2020 SERSC
 International Journal of Disaster Recovery and Business Continuity
Vol. 11, No. 1, (2020), pp. 896-901
consequence, the trader’s gets more attract on online share trading and its help the
growth of the nation.

References
6.1 Journal Article

[1] Petric Loana Ancuta, “Benefits and Drawbacks of online trading versus
traditional trading. Educational factors in online trading”, Annals of faculty of
economic, University of Oradea, Faculty of economics., vol.1, no. 7, (2015), pp.
1253-1259.
[2] George, C. G., ‘Taking stock of online trading’, Praxis, vol. 3, no. 1, (2015),
pp.12-15.
[3] Oh N. Y., Parwada J. T. and W alter T. S., ‘Investors' trading behavior and
performance: Online versus non-online equity trading in Korea’, Pacific-Basin
Finance Journal, vol. 16, (2007), pp. 26–43.
[4] Jobman D., Salcedo Y. and Depilla M., ‘Online trading: What traders want; What
brokers offer’, ProQuest Central, (2003), pp.60.
[5] Hoffman, D.L., Novak, T.PP. & Chatterjee, PP., ‘Commercial scenarios for the
Web: opportunities and challenges’, Journal of Computer Mediated
Communication, (1996), available at:
http://labeee.ufsc.br/~luis/egcec/artigosdoc/CE-comercial%20scenarios-
hoffman.PDF [02 Febr 2015]
[6] Bansal Arshia, Kashyap Neha, Mehta Piyush, Raina Krishan Kumar, “A Study on
Problems and Prospects of Online Stock Trading in Solan Town of Himachal
Pradesh”, International Journal of Economic Plants, vol. 5, no.4, (2018), pp. 184-
191.

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