Canadian investor sentiment on the rebound

- Bulls and bears in a dead heat, new survey finds -

TORONTO, Feb. 9, 2012 /CNW/ - Investor sentiment in Canada is at its most positive since the stock market collapse of 2008, a new Franklin Templeton survey has found.

In its latest national research, Franklin Templeton Investments Corp. found 40 per cent of investors describe themselves as opportunistic, risk-taking or analytical, the three categories that typically suggest buying behaviour. The number of investors describing themselves as "opportunistic" has risen by 75 per cent since July 2011. These are the most bullish results since the investment management company began tracking investor sentiment after the global financial crisis three years ago.

"It's the biggest change in investor sentiment in three years," said Don Reed, president and chief executive officer of Franklin Templeton.

The survey of 1,032 Canadian investors was conducted February 1, 2 and 3 using the Angus Reid Forum.

Notwithstanding the rise in positive sentiment, investors remain divided in their outlook, with 42 per cent in the two most risk-averse categories, describing themselves as "suspicious" (27 per cent) or "timid" (15 per cent). The number of investors saying they were "not sure" has dropped from 30 per cent in June 2011 to 17 per cent today, suggesting that sentiment is hardening.

There's a deep division among investors when it comes to tactics too. When asked what action, if any, they would be taking in light of today's markets, 30 per cent of investors said they "have a good strategy" and are "sticking with it". In contrast, 30 per cent of investors said they were "not making new investments".

"Franklin Templeton's research suggests there will be a tug of war between the bulls and the bears in 2012," Mr. Reed said. "It's a perfect time for investors to get off the sidelines and re-enter the equity markets."

In other results, the survey found:

• There's a large and widening gap between men and women when it comes to investor sentiment. Fifty per cent of male investors surveyed describe themselves as opportunistic, risk-taking and analytical, up from 37 per cent in June last year. In contrast, 32 per cent of female investors identify with these optimistic attributes, up from 24 per cent in 2011.
• Canadian investors surveyed are relying on two retirement income sources above all others: government plans such as the Canada Pension Plan and Old Age Security (74 per cent of respondents) and Registered Retirement Savings Plans (72 per cent). Nationally, 41 per cent of respondents said they would rely on their home or property as a retirement income source; in British Columbia, the figure spiked to 54 per cent while in Quebec, fell to 34 per cent.
• Running out of money is the biggest financial concern of Canadian investors regarding retirement (49 per cent). Only 10 per cent of Canadian investors cited the ups and downs of the stock market as their biggest concern.

"In their retirement planning, Canadians are relying on three acronyms: CPP, OAS and RRSPs," Mr. Reed said. "Given the Prime Minister's recent musings about raising the age of eligibility for public pension benefits, the need for smart RSP planning is greater than ever."

About the survey:

On Feb. 1, 2 and 3, 2012 an online survey was conducted among 1,032 randomly selected Canadian adults who currently invest in the stock market or have done so in the past five years, and who are Angus Reid Forum panelists. The margin of error which measures sampling variability — is +/- 3.05%, or 19 times out of 20. The results have been statistically weighted according to the most current education, age, gender and region Census data. Discrepancies in or between totals are due to rounding.

About Franklin Templeton Investments:

Franklin Templeton Investments Corp. is a wholly owned subsidiary of Franklin Resources, Inc. (NYSE: BEN), a global investment organization operating as Franklin Templeton Investments. Franklin Templeton Investments provides global and domestic investment management solutions managed by its Franklin, Templeton, Bissett, Mutual Series, Fiduciary Trust and Darby investment teams. The San Mateo, CA-based company has more than 60 years of investment experience and approximately US$704-billion (C$706-billion) in assets under management as of January 31, 2012.

Franklin Templeton Investments Corp. has more than 600 employees providing services to more than one million unitholder accounts and more than 200 pension funds, foundations and other institutional investors. Additional information on Franklin Templeton Investments Corp. can be found at www.franklintempleton.ca.

For further information:

Media contacts:

Sarah Kingdon, Consultant, Public Relations, Franklin Templeton Investments, 416.957.6191

Keith Damsell, Vice President, Corporate Communications, Franklin Templeton Investments,
416.957.6099

Debra Chan, Senior Consultant, Argyle Communications, 416.968.7311 X229