Although their investments may have lost as much as 40% to 50% of their value, Canadians are resilient in their faith in mutual funds, PricewaterhouseCoopers found in a survey of 867 people who own mutual funds.
Seventy-three percent said they believe mutual funds remain a good investment vehicle, 75% trust their financial adviser and 73% said their adviser has done a good job over the years. Further, 65% believe their adviser is looking out for their best interest when suggesting investments.
However, only 38% believe their mutual fund investment portfolio will improve in the next two years. Twenty-three percent think it might take three years, and 27% believe it will take five years.
When asked to name three types of mutual fund that will meet their retirement needs, they most frequently cited balanced funds, guaranteed funds and fixed income fundsnot equity funds.
Investment products are generally complex, especially given the myriad of offerings and providers from which to choose, said Raj Kothari, leader of the investment management practice at PwC Canada. Investors today are forced to make sense of the daily barrage of conflicting messages. Its no wonder the value of advise is crucial toinvestors.
Kothari said it is very important that investors still trust mutual funds in a climate of failed companies, corporate scandals, government bailouts, staff redundancies and decreased corporate profits.