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Bailey McCann, Opalesque New York: Investors want more returns than index funds can give, at least that is the finding from the latest investor survey from Natixis. Investors that responded to the survey say they need returns 8.9% above inflation, 51% higher than experts believe the markets will deliver.
Despite this desire for higher returns, investors are still worried about the risk of a correction. Those fears are keeping investors in liquid index products, according to the survey. Fewer than half (45%) of investors completely trust themselves to make investment decisions, and while most admit they need help, they are conflicted about whom to trust. Confusion about even basic topics, such as the attributes of index investing, points to a need for greater clarity.
When it comes to investment decision-making, 88% of investors say they trust their financial advisor more than any other source, including industry analysts (73%), close friends and family (72%), investment ratings and awards (67%), the financial media (62%) and social media (43%). More investors trust their financial advisors than they do financial institutions overall (69%), so much so that 60% would follow their current advisor if he or she went to a different firm.
Some of the blame for investor confusion can be traced to closet indexers - firms that claim to actively manage their funds and charge commensurate fees, but deliver portfolios that mimic benchmarks. Sixty-four percent of investors s...................... To view our full article Click here
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