TORONTO, Feb. 4, 2014 /CNW/ - The first robust portrait of Canadians' behavioural response to investment risk since the 2008-09 market meltdown debuts today via an interactive learning tool that leverages new research about our complicated money-selves.
The Canadian Money State of Mind Risk Survey 2014, a national study conducted for Investor Education Fund (IEF) by The Brondesbury Group, provides a compelling look at how Canadians handle - or don't handle - risk, emotion, financial loss and decision-making when it comes to their investments.
It is a comprehensive analysis that provides financial institutions, public policy decision-makers, financial advisers and "everyday" investors with a perceptive reflection to anchor future choices and pursue better outcomes. The study highlights behavioural and attitude differences among demographic segments based on gender, household income, age grouping and region, and also differentiates optimists from pessimists and high-risk from low-risk investors.
Some of the findings from The Canadian Money State of Mind Risk Survey 2014 include:
- Almost one-quarter of individuals who identify themselves as low-risk investors own "medium- to very high-risk" products; conversely, seven in 10 self-identified high-risk investors own "low- to medium-risk" products.
- One-in-three Canadian investors had a major loss (at least 20 per cent of their investment value) in one year. Of those who had a major loss, 51 per cent stayed the course and didn't change their investments in response.
- Just over half of investors have regretted an investment decision based on emotion, although most have done so only once or twice.
An executive summary of the full research study is available under the "Research" section of GetSmarterAboutMoney.ca.
To translate the findings into a meaningful and motivating vehicle for all Canadians, IEF has created an animated, interactive infographic available at GetSmarterAboutMoney.ca. It shares fascinating findings from the national study and presents select survey questions to which users input their own self-reported investment behaviours and beliefs. They can then compare themselves against their fellow Canadians. From the output they receive, users will gain a better understanding of themselves and access free and relevant investment and personal finance resources at GetSmarterAboutMoney.ca.
"The Canadian Money State of Mind Risk Survey 2014 provides a research-based understanding of varying factors that affect investing," says IEF President Tom Hamza. "By prompting Canadians to compare themselves using the new tool, we're seeking to instil greater self-awareness of risk and how it affects your investments. We want to stimulate Canadians to think about money, emotion and risk-taking - while raising their awareness of GetSmarterAboutMoney.ca as a source for getting unbiased investment knowledge and making better decisions."
The study could also prove to be of value to advisers, planners and investment brokers as it reveals why some investors may take excess risk, while others retreat from potential rewards. It also highlights the low priority Canadians place on having personal investment knowledge and pinpoints the top investing concerns for the next two years.
"Through The Canadian Money State of Mind Risk Survey 2014, individual investors get a new understanding of themselves. Financial advisers get a new source of understanding about their clients and financial institutions get new insight into risk perception among Canadians," notes Hamza. "If there's one common message IEF would deliver to all of these audiences, it's that Canadian investors should have more self-awareness about what influences sound decision-making."
About The Canadian Money State of Mind Risk Survey 2014 ("Investor Risk, Behaviour & Beliefs")
The research underlying The Canadian Money State of Mind Risk Survey 2014 was conducted by The Brondesbury Group for IEF nationally via the Internet in English and French in September 2013. Eligible respondents had to have at least one of eight types of investments to participate. Some quotas were imposed to ensure an appropriate mix of age and gender. Regional quotas were also used to improve accuracy by region and major Census Metropolitan Area (CMA).
In total, 2,002 people responded, giving overall accuracy of +2% some 19 in 20 times. To get more in-depth results for several CMAs in Ontario, half the sample was drawn from Ontario. Some 400 interviews came from Quebec, 200 from British Columbia and Alberta, 100 interviews from the Prairie provinces and Atlantic provinces. The survey sample size is sufficiently large that, with weighting, results are representative of a broad cross-section of the Canadian population.
About Investor Education Fund
Investor Education Fund (IEF) is a non-profit organization founded and supported by the Ontario Securities Commission that provides unbiased and independent financial tools to help you make better money decisions. IEF offers research-based financial information to consumers via GetSmarterAboutMoney.ca and to students, parents and teachers through InspireFinancialLearning.ca and extensive classroom programs.
Image with caption: "Infographic: Investor Education Fund. Canadian Money State of Mind Risk Survey 2014. (CNW Group/Investor Education Fund (IEF))". Image available at: http://photos.newswire.ca/images/download/20140204_C7188_PHOTO_EN_36181.jpg
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