North America Divided - Canadians think cash is king, while Americans prefer stocks

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WATERLOO, ON, Feb. 3, 2015 /CNW/ - Over one-third of Canadians polled say it is a good time to invest in cash according to a recent Manulife Investor Sentiment Index (ISI). By contrast, investors across the border don't agree, *six in ten say cash is a bad investment right now but feel confident about investing in stocks. The ISI is a semi-annual measure of investors' views on a range of asset classes and savings and investment vehicles, as well as their confidence in these areas.

"It's really interesting that over one-third of Canadians in both the affluent (34 per cent) and general population (37 per cent) segments see cash as a good investment, because consecutive ISI surveys conducted in the U.S. show cash is viewed as the worst investment - 60 per cent don't think it's a good time to hold on to cash," said Megan Greene, Chief Economist, Manulife Asset Management. "Before oil prices dropped, Canadians were getting out of the market and saving cash - a non-traditional investment product. These numbers show that some Canadians don't see cash as a high risk investment because they feel it's more secure and readily available."

A different story in the U.S.
ISI Survey findings show that Canadian and American investors (affluent segment) have different views on cash and stocks as good investments right now. Over four in ten Canadian investors polled identified that it is a good time to invest in stocks, ranking cash just 10 per cent less than stocks. By contrast, six in ten investors in the U.S. say it is a good time to invest in stocks but only 13 per cent say it's a good time to save cash. Both ISI surveys were conducted in the fall of 2014 before oil prices dropped.

**Canada vs. the U.S. - Good time to invest

Canadian investors      American investors
  • Own home - 72 per cent
  • Balanced Mutual Funds - 55 per cent
  • Real Estate - 48 per cent
  • Stocks - 44 per cent
  • Fixed Income Investments - 35
  • Cash (savings accounts) - 34 per cent
  • Own home - 68 per cent
  • Stocks - 60 per cent
  • Balanced Mutual Funds - 58 per cent
  • Real Estate  - 56 per cent
  • Bonds - 22 per cent
  • Cash (CDs, MMAs)- 13 per cent

Canadian investors think cash is king (general population)

Top priority to invest in over the next 12 months

  • Home - 24 per cent
  • Cash  - 23 per cent
  • TFSA - 18 per cent
  • RRSP - 16 per cent

Why Canadians see cash as a top priority

  • 20 per cent - funds are readily available
  • 19 per cent - habit/my only investment/all I can afford
  • 11 per cent - secure/no risk

*fall 2014 John Hancock Investor Sentiment Index
**Affluent populations
 
Gen population - household financial decision-makers aged 25+
 
Affluent population - household financial decision-makers aged 25+, with a household income of $75,000+ and investable assets of $100,000

About the Manulife Investor Sentiment Index
The Manulife Investor Sentiment Index is a semi-annual measure of investors' views on a range of asset classes and savings and investment vehicles, as well as their confidence in these areas. This year marks the sixteenth year that Manulife has conducted the survey. The index is based on an online survey of 1,000 Canadians aged 25+ that was conducted between November 15-29, 2014 by Research House, an Environics Company.

About Manulife
Manulife is a leading Canada-based financial services group with principal operations in Asia, Canada and the United States. We operate as John Hancock in the U.S. and as Manulife in other parts of the world. We provide strong, reliable, trustworthy and forward-thinking solutions for our customers' significant financial decisions. Our international network of employees, agents and distribution partners offers financial protection and wealth management products and services to millions of clients. We also provide asset management services to institutional customers. Funds under management by Manulife and its subsidiaries were approximately C$663 billion (US$591 billion) as at September 30, 2014.

Manulife Financial Corporation trades as 'MFC' on the TSX, NYSE and PSE, and under '945' on the SEHK. Manulife can be found on the Internet at manulife.com  

SOURCE Manulife Financial Corporation

Image with caption: "Manulife Investor Sentiment Index: Investor Trends Canada vs. the U.S. (CNW Group/Manulife Financial Corporation)". Image available at: http://photos.newswire.ca/images/download/20150203_C9634_PHOTO_EN_43364.jpg

For further information:

Media Contact: 
Ainka Jess
Media Relations Consultant
(416) 415-7730
Ainka_Jess@manulife.com
@ManulifeNews


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