Survey: Investors Struggle To Grasp Basics Of Fixed Income
December 18, 2019 by Christopher Robbins
Given the increasing efficiency of equity markets, most do-it-yourself investors can find low-cost access to U.S. stocks – but fixed income is another matter.
In fact, DIY investors are at a significant disadvantage to their professionally advised peers when it comes to investing in bonds and other fixed-income instruments, according to recent research from BNY Mellon Investment Management.
Approximately one-in-three investors (35%) without an advisor report understanding fixed-income investments, compared to nearly two-thirds (64%) of those who have worked with an advisor, according to a survey of more than 2,000 Americans.
Similarly, 64% of respondents working with an advisor reported having some allocation to fixed-income investments, compared with just 25% of those who have not worked with an advisor. Yet, paradoxically, working with an advisor seems to increase an investor’s appetite for risk – just 27% of those not working with an advisor expressed some or a strong appetite for risk, compared with 42% of those who have worked with an advisor.