I have tried to shed some light on the factors that affect the stock market. They are not exhaustive however they are the key ones.

1. Trust. This is an important factor due to which the penetration of the financial markets is less. It is mis-conception of the common public that investing in markets is gambling and hence they feel they might incur huge losses.

2. Economic growth: The prformance of the economy also matters in this case because only if it is performing better then people will invest their money.

3. Income: Only when the income increases an individual will consider investing and also will be willing to take on more risks.

4. Awareness: The information and knowledge related to the markets and the knowledge regarding their functioning will help improve the penetration.

5. Policies: The government policies will affect the people's perceptions regarding the markets and favorable policies will improve the adoption of the markets in the masses.