Manulife Financial Surveys Reveal Upward Trend of Investor Sentiment in Second Quarter

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Jul 09, 2013, 07:00 ET

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Surveys measure investor views on investment choices, financial goals and economic outlook in the world's biggest and fastest-growing markets

Manulife Investor Sentiment Index rose to +21 in Asia (from +17) and to +35 in Canada (from +31), while the John Hancock Investor Sentiment Index rose to +26 in the U.S (from +24)

TORONTO, HONG KONG, July 9, 2013 /PRNewswire/ - Investors in many of the largest economies in the world appear upbeat about their financial futures, according to second quarter 2013 Investor Sentiment Surveys conducted simultaneously by Manulife Financial and John Hancock.

The second Manulife Investor Sentiment Survey in Asia, based on 3,500 interviews across China, Hong Kong, Taiwan, Japan, Singapore, Malaysia and Indonesia, produced an overall Index score of +21. In Canada, the Index score was +35. In the U.S., the Index score was +26.

"The surveys clearly indicate that investor sentiment is improving markedly. Survey data from three of the largest economies in the world - the United States, China and Japan - as well as Canada and other nations indicate a very positive turn in outlook," said Donald A. Guloien, President and Chief Executive Officer of Manulife Financial.

In Asia, key drivers of the Index were positive views of stocks (+15), mutual funds/unit trusts (+14) and real estate (+19). Overall sentiment was highest in Indonesia (with an individual Index score of +60), and Malaysia (+48). The largest rise in sentiment occurred in Japan (from +4 to +21). Only one market, Hong Kong, strayed into negative sentiment (-11).

In Canada, the Index score was driven by investors' optimistic views on investing in their own homes (+70), balanced mutual funds (+47) and stocks (+32). Canadians also believe it is a good time to invest in real estate (+34).

In the U.S., the Index score was driven by investors' positive attitudes toward investing in their own homes (+62), stocks (+54), real estate (+53), and balanced mutual funds (+51).

"Amid steadily improving equity markets in Asia and North America, investors appear to be regaining confidence in investing in companies and in longer-term, less liquid assets such as real estate, as the rebound continues from the multi-year worldwide recession," said Bill Cheney, Chief Economist, Manulife Financial.

Manulife began surveying investor sentiment 14 years ago. The surveys now include 5,500 investors across markets in Asia, the United States and Canada.

Financial priorities and outlook

Investors in Asia, Canada and the U.S. were also asked about their top financial priorities, whether or not they are on track with their financial goals, and whether or not they expect their personal financial position to improve over the next two years.

Top financial priority. Saving for retirement ranked as the top financial priority for investors in Asia (21 percent) and Canada (22 percent). In the U.S., this was the second top financial priority (23 percent), following maintaining one's current lifestyle (30 percent).
Reaching financial goals. At least half of investors in all three regions said they are on track to achieve their financial goals (Asia 50 percent, Canada 61 percent, U.S. 60 percent). In Asia, investors in Malaysia (62 percent) and China (64 percent) were the most on track. Similar proportions of investors across all three regions reported being ahead of plan (Asia eight percent, Canada 12 percent, U.S. ten percent).
Present and future financial position. While 46 percent of Asia investors believe they are in a better financial position today than they were two years ago, higher numbers of Canadians (56 percent) and Americans (53 percent) share that sentiment. Looking two years ahead, 57 percent of Asian investors, 61 percent of Canadians, and 49 percent of Americans think they will be in an improved financial position.

About the Investor Sentiment Index

In the three regional surveys, investors were asked to rate each of six investment categories on a five-point scale, indicating whether they think it is a very good time to invest, a good time, neither a good nor a bad time, a bad time, or a very bad time. The investment categories are: stocks/equities, bonds/fixed income, primary residence/one's own home, real estate (other than primary residence), mutual funds/unit trusts (holding a combination of stocks/bonds), and cash-like instruments (certificates of deposit, money market accounts, etc.). During the surveys, slight modifications were made in the descriptions of each investment category in order to allow for different regional terminologies.

For each investment category, an Index score was calculated as the percentage saying it is a good time and a very good time to invest minus the percentage saying it is a bad time and a very bad time to invest.

In each region, the overall Investor Sentiment Index is the average of the six investment category indices. The Manulife Investor Sentiment Index in Asia is an average of indices in the seven Asian markets surveyed.

About the Manulife Investor Sentiment Index in Asia

It is a quarterly, proprietary survey tracking investors' views across seven markets in the region on their attitudes towards key asset classes and investment vehicles. The survey is based on 500 online interviews in each market of Hong Kong, China, Taiwan, Japan, and Singapore; in Malaysia and Indonesia it is conducted face-to-face. Surveys took place mid-April to May 2013. Respondents were middle class to affluent investors, aged 25 years and above who are the primary decision maker of financial matters in the household and currently have investment products.

About the Manulife Investor Sentiment Index in Canada

The online survey was conducted among a sample of 1,001 Canadian investors from May 16 through May 27, 2013. Respondents were household financial decision-makers aged 25+, with a household income of $75,000+ and investable assets of $100,000+. In a similarly-sized random sample survey, the margin of error would be plus or minus 3.1 percentage points at the 95 percent confidence level.

About the John Hancock Investor Sentiment Index

John Hancock's quarterly Investor Sentiment Survey was conducted online, with 1,078 investors surveyed from May 13^th to May 24^th, 2013. The question regarding 'reaching financial goals' was asked in the Q4 2012 wave with 1,127 investors surveyed November 26^th to December 7^th, 2012. To qualify, respondents were required to participate at least to some extent in their household's financial decision-making process, have a household income of at least $75,000, and assets of $100,000 or more. In a similarly-sized random sample survey, the margin of error would be plus or minus 3.05 percentage points for Q2 2013 and 3.0 for Q4 2012 (at the 95 percent confidence level).

About Manulife Financial

Manulife Financial is a leading Canada-based financial services group with principal operations in Asia, Canada and the United States. Clients look to Manulife for strong, reliable, trustworthy and forward-thinking solutions for their most 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 Financial and its subsidiaries were C$555 billion (US$$547 billion) as at March 31, 2013. The Company operates as Manulife Financial in Canada and Asia and primarily as John Hancock in the United States.

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

SOURCE Manulife Financial Corporation

Image with caption: " Investors in Asia and North America appear upbeat about their financial futures. (CNW Group/Manulife Financial Corporation)". Image available at: http://photos.newswire.ca/images/download/20130709_C6032_PHOTO_EN_28857.jpg