There are affluent investors who do not participate in the process at all; they turn over assets to be managed by their financial advisor, check on returns occasionally, and otherwise, give their investments no personal consideration.
Then there are those who pay close attention to how their investments are doing. They are in constant contact with their financial advisor. They enjoy the process.
The time advisors spend trying to understand the differences between investors and their attitudes toward investing is time well spent, because the differences are real.
Providing financial advice is not a one-program-for-all operation. Investors have clear differences in attitudes and investing behaviors based on age, wealth, occupation and advisor dependency.
Those differences are exhibited in the first pages of Spectrem’s new study Evolving Investor Attitudes and Behaviors*, which examines how investors feel about the investment practices they utilize in their pursuit of a stronger portfolio.
Investors in the study were asked the simple question of whether they enjoy investing. Only 47 percent of investors said they do enjoy the process of allocating funds in the hopes of creating more funds, but that percentage grew to 57 percent among Senior Corporate Executives and 5 percent among the wealthiest investors in the survey, those with a net worth between $15 million and $25 million.
Advisors would certainly benefit from knowing which of their clients fall upon which side of the fence on this topic. Those who enjoy investing are more likely to be interested in conversation with their advisors as well as frequent updates, while those who do not enjoy the process may want to be left alone except in dire situations.
A similar question was asked: “Do you like to be involved in the day-to-day management of accounts?” Fifty-three percent of investors like to stay atop their investment decisions and performance on a daily basis, which is another characteristic advisors would benefit knowing about their clients. Such attention makes an investor more knowledgeable, more active, but also less dependent upon an advisor’s knowledge.
Male investors are more likely than females (57 percent to 46 percent) to want to be involved on a daily basis with their investment accounts, and, as expected, those investors with a net worth above $15 million are the ones most likely to be paying attention daily (60 percent).
Evolving Investor Attitudes and Behaviors includes research on investor concerns, market expectations and the impact of 2020 politics.
*This research is part of your Spectrem subscription.
©2020 Spectrem Group
Keywords: participation, advisor, investor, attitudes, behaviors, Spectrem, investing, management, concerns