If your answer to this question is resoundingly positive, you are among a special group. It seems that many consumers have little or no idea about investments and the principles of sound investment practice.
A new survey for the Australian Securities & Investments Commission (ASIC) on consumer investment knowledge seems to confirm once again why so many investors are caught time and time again in heavily promoted schemes that promise to pay breathtaking high returns.
ASIC commissioned Roy Morgan Research to survey more than 1200 investors in order to assist the regulator better educate investors, provide more effective investor warnings, and very importantly, to develop more-effective ways to keep investor expectations to a realistic level.
The research found that only 47% of investors surveyed had a long-term financial goal and plan to reach that goal. Individuals often make investments, according to the research, because of various personal incidents in their lives such as divorce, inheritance, redundancy, or retirement - rather than because of a "plan to become an investor".
While 78% of the investors surveyed had heard about the attributes of having a diversified investment portfolio, 36% considered that having 100% of their investments in government bonds equated to good diversification.
And the researchers found that the investment knowledge of many trustees of SMSFs was clearly lacking in several areas including in regard to avoiding frauds and scams.
This survey is well worth a close read - click here to view.
20th-May-2008 | 
