The spate of investigations into mutual fund trading practices and intense media coverage has prompted more than one-third of existing mutual fund investors to say they are unlikely to buy mutual funds any time soon, according to a survey conducted by The Lumin Collaborative, a Richmond, Va.-based PR firm. Further, 77% say they would pull their money from any fund they believed violated its fiduciary responsibility.
Possibly the most alarming trend the survey of 650 mutual fund investors revealed is that 30% of the participants plan to stay invested in the market but will stop investing in mutual funds as a direct result of the scandal. Nearly half the respondents gave Putnam and Strong the thumbs down, 47% and 44% respectively, saying those are the funds they are most likely to steer clear of. Among those investors, 17% said Putnam was one of the worst fund companies.