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Investment

Canadian Investors More Optimistic than Americans, Manulife and John Hancock Investor Sentiment Surveys Indicate

Canadians believe it's a good time to invest in their homes while Americans indicate it's a good time to invest in mutual funds

TORONTO - North American investors are feeling optimistic, according to Investor Sentiment Index (ISI) surveys conducted by both Manulife Financial and John Hancock. In the first-ever comparison of the two surveys, results suggest that Canadians are nearly twice as likely to view the present as a "good" or "very good" time to be investing in a range of investment vehicles as are their American counterparts.

The Canadian Manulife ISI, carried out in December 2011 , rose five points and hit a year end high of +26, while the American John Hancock ISI showed a similar increase of five points and ended the year at +15. Manulife Financial also conducted a supplementary survey targeted at the same financial demographic as John Hancock's ISI; that index score was +27.

"Growing consumer confidence is an important barometer when looking at the future health of the economy on either side of the border," said Bill Cheney Chief Economist for the companies. "Consumer confidence usually translates into increased spending, a critical component to keep their economies moving forward."

The Canadian and American investors surveyed demonstrate comparable views about their future financial well-being. Fifty-five percent of Canadians feel they would be better off financially two years from now, with 37 percent saying their situation would be the same, and eight percent saying they expect to be worse off financially. Fifty-three percent of Americans surveyed believe they would be in a better financial position, with 38 percent expecting to be in the same financial situation, and nine percent expecting to be worse off.

When asked about using a financial advisor, 53 percent of American investors say they use a financial advisor versus 68 percent of Canadian investors.

Outcomes from Manulife Financial's supplementary survey and John Hancock's ISI indicate that Canadians and Americans share many similarities despite differences in investment climate, tax regulations and social infrastructure. The top financial concerns for 2012 in both markets are: decreasing investment values, ability to save for retirement, and managing personal debt. As their top three financial resolutions for the New Year, both Americans and Canadians rank saving for retirement as their #1 goal, followed by reducing non-mortgage debt and trimming household budgets.

Regarding specific investments, Canadians had a clear preference for investing in their own homes. Americans were more inclined to invest in balanced mutual funds than were their Canadian counterparts, and they had a much stronger aversion to keeping their funds in cash or cash-like investments.