Americans' Investment Sentiment Revealed

Americans believe technology and gold will be top-performing investments in 2011

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Mar 02, 2011, 10:36 ET

ST. LOUIS, March 2, 2011 /PRNewswire/ -- As Americans move past the economic downturn and begin considering plans for investing in the coming year, many believe that technology stocks and gold will set the pace for 2011.

In a recent survey from financial services firm Edward Jones, more than one-third (36%) of Americans said that they believe technology stocks will perform best in 2011. Gold followed close behind with 31% of Americans betting on a positive performance in 2011.

"While Americans believe that technology stocks and gold will perform the best this year, it's important that they keep a diversified and balanced portfolio despite their predictions," said Kate Warne, investment strategist at Edward Jones. "What seems likely to perform best at the beginning of the year may stumble. Unpredictable events highlight the need for broad diversification."

Gender seemed to influence this sentiment as 40% of female respondents indicated they expect technology stocks to perform best, while more than one-third of male respondents (37%) indicated they believe gold will be the winner this year. Age was also a factor as nearly half of Americans (47%) between the ages of 18 and 34 were considerably more optimistic about technology stocks than those in older age brackets. Geographically, respondents in the West indicated they were more bullish on technology stock performance in 2011 than their counterparts in the rest of the country, with 42% responding that they are optimistic about investing in technology this year.

"Our research of gold's performance since 1970 indicates that gold tends to fall as quickly as it rises, and over longer-term periods, it fails to match the performance of stocks as represented by the S&P 500," Warne said.

"Our research also shows that gold tends to be considerably more volatile than the S&P 500," Warne said, citing that since 1970 Edward Jones found that 35% of the 10-year periods measured resulted in a loss for an investment in gold, compared to a mere 6% for the S&P 500.

Optimism about gold's performance was higher among respondents with lower incomes. Thirty seven percent (37%) of those polled in the lowest income bracket (respondents whose income was less than $35,000 per year) indicated they believe gold will do best in 2011 and only 25% of those in the highest bracket (respondents whose income exceeded $100,000 per year) express the same sentiment.

Americans also noted that they were still uncertain about the performance of blue chip stocks as only 10% believe those stocks will perform the best this year. Similarly, real estate stocks scored low, as only 9% think it will outperform other asset classes. However, respondents in the Northeast showed more optimism than their peers around the country, with 14% indicating they expect real estate stocks to surpass other investments.

The study of 1,019 respondents, conducted by Opinion Research Corporation on behalf of Edward Jones, revealed that household income and size influenced Americans' choice of stocks. Respondents with a household income of more than $100,000 believe that technology stocks will perform significantly better (39%) than gold (25%).

About Edward Jones

Edward Jones provides financial services for individual investors in the United States and, through its affiliate, in Canada. Every aspect of the firm's business, from the types of investment options offered to the location of branch offices, is designed to cater to individual investors in the communities in which they live and work. The firm's 12,000-plus financial advisors work directly with nearly 7 million clients to understand their personal goals -- from college savings to retirement -- and create long-term investment solutions that emphasize a well-balanced portfolio and a buy-and-hold strategy. Edward Jones embraces the importance of building long-term, face-to-face relationships with clients, helping them to understand and make sense of the investment options available today.

Edward Jones, which ranked No. 11 on FORTUNE magazine's "100 Best Companies to Work For 2011," is headquartered in St. Louis. The Edward Jones Web site is located at www.edwardjones.com, and its recruiting Web site is www.careers.edwardjones.com. Member SIPC.

* Survey was based on 1,019 telephone interviews of U.S. adults conducted between the dates of February 24-27. The survey was conducted with a 95% confidence level.

SOURCE Edward Jones