According to this 2016 study from CFA Institute, investors are expecting higher levels of transparency than ever before, holding their investment managers to the highest ethical standards, and are laser-focused on returns.
The survey finds that trust levels among investors have risen since our first joint study in 2013, but it is not all good news. With higher trust comes higher expectations, and the gap between what investors want and what we as a profession are delivering is cause for concern, and action.
From Trust to Loyalty
In this survey, we investigated the level and nature of trust within the investment community, surveying retail investors and institutional investors around the world. We asked how much they trust financial services and how loyal they are to their current investment firms. The findings, including comparisons with the 2013 CFA Institute and Edelman Investor Trust Study (PDF), offer investment professionals and firm leaders insights into how to strengthen client relationships and build better firms.
- Retail investors’ trust in financial services increased in the United States, United Kingdom, and Australia, and fell in Canada and Hong Kong since 2013.
- Investment costs are even more important than performance to investors globally, and firms are not meeting expectations in this area.
- Institutional investors rank ethical standards above all else in important attributes of a firm.
- Investors in China and India lean toward robo-adviser options, whereas investors in Canada, the United States, and United Kingdom still value human interaction.
- Transparency and cyber security are key concerns among investors.
- A third of investors feel that another financial crisis is likely within the next three years, and about half of investors lack confidence in their firm’s ability to manage through a crisis.
- From Bust to Trust (LinkedIn) by Paul Smith, CFA
- CFA Institute Study: Disclosing Fees, Conflicts Vital to Adviser-Client Relationship (Market Integrity Insights) by Rebecca Fender, CFA
- What Investors Want (Enterprising Investor) by Rebecca Fender, CFA