Investors worldwide have little trust in the investment profession, but believe there is much that can be done to restore trust, says the CFA Institute/Edelman ‘Investor Trust Study.’ It reveals that just 53 per cent of investors in the U.S., UK, Hong Kong, Canada, and Australia trust investment firms to do what is right. Retail investors are less trusting of the industry (51 per cent) than their institutional counterparts (61 per cent), and investors in the U.S. (44 per cent) and UK (39 per cent) are less trusting than those in Hong Kong (68 per cent). This lack of trust in the investment industry does not translate to the capital markets; nearly three-in-four investors report they are optimistic about their ability to earn a fair return in capital markets. Yet intensity of that confidence is low, as just 19 per cent of investors ‘strongly agree’ that they have a fair opportunity. Looking to the future, investors expect government to help build trust in capital markets. Fifty-two per cent point to national and global regulators as having the greatest opportunity to effect change and enhance trust moving forward. Investors report that trusting an investment manager to act in their best interest is the single most important factor in making a hiring decision. Achieving high returns was cited only half as often, and fee amounts/structure only a fifth as much.
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