Risk? Investors Don’t Understand Labels

A recent research by YouGov has found that of 2,039 adults surveyed across Great Britain, of which 1384 (68%) have an investment/ savings/ pension product, over three quarters (76%) manage their savings and investments themselves.

However, when asked how much a ‘cautious’, ‘balanced’ or ‘aggressive’ fund might lose in a bad year, one in five (20%) did not know.

Man showing business graph on wood table

Of those who did provide an estimate, there was a significant gap between investor expectations and actual fund behaviour.

In fact, almost three quarters (70%) of investors said they did not expect a ‘cautious’ portfolio to lose more than 10% in a bad year.

According to expert, this confirms that investors still don’t understand the reality of investment risk. 

Find out more here.