Investor risk, behaviour and beliefs
This national study 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.
Toronto, ON, February 4, 2014 – 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.
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.
The survey asked investors across Canada questions that provided insight on three key investmentInvestment An item of value you buy to get income or to grow in value.+ read full definition influences:
- How does the economic environment affect risk-taking?
- How do attitudes and beliefs affect risk-taking?
- How do past actions (or inaction) affect risk-taking and investment choices?
- 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.
Read the executive summary.
About the survey
This report is based on 2,002 responses to an Internet survey about 20 minutes in length. The survey was conducted across Canada in September 2013. All respondents were investors. Some quotas were imposed to ensure an appropriate mix of age and gender. 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. Overall accuracy is ±2% some 19 out of 20 times. Results are weighted by age, gender and region to reflect true population demographics.