Study Shows Investors Not Confident About Reaching Investment Goals
Investor optimism slumped dramatically in July, as investors became increasingly pessimistic about reaching their investment goals, according to the results of a study released today by UBS Paine Webber and Gallup.
The Index of Investor Optimism, a monthly poll conducted by the two companies, showed that the index decreased 22 points in July to 82. The index had a baseline of 100 when it was established in 1996.
Expectations for returns during the next 12 months declined to 10.4% from 10.7% last month, according to the survey's results. The drop was most significant among investors younger than age 40, who expect returns of 10.6%. Last month, those same investors expected 12% returns.
The number of investors who are pessimistic about reaching their investment goals during the year increased from 22% in June to 28% in July, according to the study.
Investors are clearly discouraged by the markets' marked decline during the past 15 months and the survey results indicate that they have resigned themselves to continued volatility, said UBS PaineWebber Senior Investment Strategist Mary Farrell, in a statement.
The study, conducted between July 1 and July 15, surveyed 1,000 randomly selected investors who had total savings and investments of $10,000 or more, the statement said.