The continued wariness casts a cloud on the long-term strength of Japanese stocks, even as individual investors are crucial to sustaining a recovery, experts say. Fear of stock markets also limits the broader effect of the wealth generated so far by Mr. Abe’s economic policies, because too few ordinary Japanese stand to benefit directly from stock market gains. And it undermines efforts by Mr. Abe to shift the trillions of yen sitting in low-yielding savings accounts in Japan toward more productive investments.

“Any long-term market recovery hinges on the support of individual investors,” said Masayuki Doshida, senior market analyst at Rakuten Securities, an online retail brokerage firm. He said that some individual investors had bought stocks on margin, or borrowed money from brokers to pay for their stock purchase. But once those stocks fell past a certain value, many investors were forced to sell their shares, worsening the market fall.

“But I’m optimistic. I’m waiting for investors to regain their nerve and jump back in,” Mr. Doshida said.

The Japanese remain some of the most cautious investors in the industrialized world. Stocks and mutual funds together made up just 11 percent of financial assets held by individuals in Japan at the end of last year. That is less than half the levels seen in 1990 near the bubble’s peak, and far below the current 45 percent in the United States and 22 percent in the euro zone, according to figures from the Bank of Japan.

Japanese households instead hold 55 percent of their financial assets as cash and savings, despite near-zero interest rates. At the peak of the bubble, Japanese savers stashed only 40 percent of their assets there. The comparable rate is about 15 percent in the United States and 36 percent in Europe.

In the bubble years, novice investors followed Japanese corporations in taking up zaiteku, a Japanized abbreviation of investment technology, or the art of speculative investment in stocks, bonds and real estate. Neighborhood stockbrokers popped up across Japan.

The 1987 listing of Nippon Telegraph and Technology, the former state-run telecommunications company, drew such investor enthusiasm that its share price almost tripled in the first two months of trading, briefly making it the world’s most valuable company by market capitalization.