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MORGAN STANLEY TRI-STATE INVESTOR POLL

 

TRI-STATE INVESTORS OPTIMISTIC ABOUT 2014, SAYS MORGAN STANLEY WEALTH MANAGEMENT’S INVESTOR POLL

 

TECHNOLOGY, ENERGY, PHARMACEUTICALS ARE MOST FAVORABLE SECTORS

 

INVESTORS LESS CONFIDENT ON AEROSPACE AND INSURANCE DESPITE HEAVY TRI-STATE INDUSTRY PRESENCE

 

NEW YORK, JANUARY 29, 2014 – Parallel with a rising stock market, New York Metro (Tri-State) region investors are optimistic about their portfolios for 2014 yet concerned about stock market volatility and the potential for increased foreign conflict.[1]

 

  • 86% expect their investment portfolios to be “better” or “the same” at year-end, and 84% believe their financial well-being will be the same or better
  • Investors (83% “same” or “better”) are most bullish about their local metro area economies followed by the state economy (76%), global economy (74%), and the U.S. economy (71%)
  • Increased foreign conflict remains one of the top concerns of Tri-State investors, although the concern is reduced from a similar Morgan Stanley Wealth Management poll conducted in early 2013 (83% in Q4 2013 vs. 90% in Q1 2013)
  • 74% of investors also said they were concerned about stock market volatility

Other top concerns of Tri-State region investors include U.S. economic prospects (89%) and the federal budget deficit (83%). Concern about the trade deficit declined from 85% in the first quarter of 2013 to 78% in the final quarter. A potential U.S. debt rating downgrade (85% in Q1 2013) was not among the top five concerns in the latest poll.

 

Area industries showing less confidence with investors polled

 

                                               

[1] Survey Methods: as part of the national survey of 1,004 US investors, age 25 to 75, with $100,000 or more in investable household financial assets, an oversample of 315 Chicago area investors were interviewed. Approximately one-third of those interviewed had $1 million or more in household financial assets. Poll conducted Oct. to Dec. 2013, by GfK Public Affairs and Morgan Stanley Corporate Communications.

Except for pharmaceuticals, industries with a significant presence in the Tri-State area were mostly out of favor by investors nationally and regionally. Aerospace (just 25% said “good”), insurance (30%) and tourism (31%) were not favored by investors for 2014.

 

The sectors most favorably cited were technology (79% “good”), energy (77%), bio-technology (63%) and pharmaceuticals (56%).

 

Unlike the national results, those surveyed in the Tri-State area viewed healthcare among the favored sectors for 2014 (55% “good” in Tri-State vs. 45% nationally).

 

Tri-State investor attitudes differ from other regions

 

Investors in the Tri-State region expressed greater concern for terrorism in the U.S. versus investors in other regions of the country: 82% Tri-State versus 66% in San Francisco and 63% in Denver, for example.

 

  • 70% of Tri-State investors surveyed expressed concern over their families’ financial well-being versus 59% nationally and, for example, 53% in Atlanta

 

  • 70% of Tri-State investors surveyed said they were concerned about having funds for the unexpected, versus 58% nationally

 

  • Tri-State investors also were more concerned about the ability to retire: 63% in their region versus 53% nationally, 41% in Houston and 51% in Chicago

 

  • 61% of Tri-State investors said dividend-bearing stocks are a good investment, versus only 46% in Denver

 

  • 44% of Tri-State investors said they like gold as an investment for 2014, versus 32% in Los Angeles

 

  • Both in the Tri-State region and nationally, investors said they want guidance from a financial advisor on their portfolios’ asset allocation (89% in Tri-State and 87% nationally)

 

Most investors don’t know about alternative investment opportunities

 

The majority of investors nationwide said they were not knowledgeable alternative investments such as hedge funds, commodities and real estate although Tri-State region investors were more knowledgeable than other areas.

 

  • 66% of those in Atlanta and 60% in San Francisco said they were not knowledgeable about alternative investments compared to 48% in Tri-State

 

  • Real estate was the most frequently mentioned alternative investment owned by millionaires (64% in Tri-State vs. 77% nationally)

 

Asset allocation favors equities

 

In the Tri-State region, 23% said that cash was favored for asset allocation – despite the sharp rise in the stock market in 2013 and the near zero return on cash-related instruments. As in the earlier poll, the most favored type of investment remained equities.

 

Asked to classify investment prospects for 2014 as good, bad or neutral, investors favored dividend-bearing stocks (61% “good” vs. 48% in Q1 2013 poll) and S&P 500 index funds (54% vs. 44% in the Q1 2013 poll).

  • Investors classified corporate and government bonds and treasuries having the lowest “good” investment prospects

In-favor and out-of-favor countries

 

  • Tri-State, 61% of those polled said the U.S. was their first choice for a positive investment outlook for 2014, versus 52% nationally

 

  • India, Japan, China and Brazil were the next choices both nationally and regionally, viewed favorably by more than a third of those polled

 

  • Interestingly, 14% of Tri-State investors said the Middle East had a good investment outlook for 2014 versus 5% nationally

 

  • Russia was not viewed favorably for 2014 in both Tri-State (9% positive) or nationally (8% positive)

 

Morgan Stanley Wealth Management, a global leader, provides access to a wide range of products and services to individuals, businesses and institutions, including brokerage and investment advisory services, financial and wealth planning, banking and lending, cash management, annuities and insurance, retirement and trust services.

 

Morgan Stanley is a leading global financial services firm providing a wide range of investment banking, securities, investment management and wealth management services. The Firm's employees serve clients worldwide including corporations, governments, institutions and individuals from more than 1,200 offices in 43 countries. For further information about Morgan Stanley, please visit www.morganstanley.com.

 

©2014 Morgan Stanley Smith Barney LLC. Member SIPC

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[1] Survey Methods: as part of the national survey of 1,004 US investors, age 25 to 75, with $100,000 or more in investable household financial assets, an oversample of 315 Chicago area investors were interviewed. Approximately one-third of those interviewed had $1 million or more in household financial assets. Poll conducted Oct. to Dec. 2013, by GfK Public Affairs and Morgan Stanley Corporate Communications.

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