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Press Release

For immediate release: Thursday 26 February 2009


Investor confidence took a dip between May and November 2008 as the credit crunch encouraged more caution among investors. However, given the severity of the falls in global stock markets in October, the fall in confidence was relatively modest.

These findings come from Investment Management Association's (IMA) second bi-annual Great British Investor report, published today, which looks at the behaviour, confidence, intentions and concerns of Britain's retail investors1 as at November 2008. The survey also includes two indices, developed by IMA, to provide barometers of investor confidence and intentions:

As at November 2008:

  • The IMA GB Investor Confidence Index stands at 712 (on a scale of 0 - 200, 100 being neutral). In the six months since May 2008, confidence has swung negatively by 7 points from 78 to 71.  This is a relatively modest fall given the events which took place between that time, including the collapse of Lehman Brothers, the UK government's rescue package for the banking sector and the FTSE 100 experiencing its biggest annual fall in the 24 years since the index began.
  • The IMA GB Investor Intentions Index stands at 893 (on a scale of 0 - 200, 100 being neutral), indicating that investors are slightly more likely to withdraw from existing funds than to make new investments compared to May (when the index was 98), perhaps indicating that they would rather weather the storm rather than crystallise their losses.

Commenting, Richard Saunders, Chief Executive at IMA said:

"The IMA GB Investor Confidence Index shows that investors are less confident than they were in May. This is not surprising. What does surprise me is the resilience of investors given the severity of the events in the market between May and November.  A significant number clearly see opportunities, particularly for the longer term."

The survey's findings include:

  • The percentage of investors who believe the economic climate has worsened increased from 39% in May to 70% in November. 
  • However, 38% still see current conditions as creating opportunities for investment, this being particularly true of male and younger investors.
  • 44% of investors felt that if you see an opportunity to make a good return you should take the risk.
  • Younger investors are most likely to increase existing investments in the next 6 months but are least likely to seek advice from an IFA.
  • Brand features more strongly in investors' minds, with a notable 11 percentage point increase, to 19%, of investors stating that they would only buy a product from a provider that they know and is well-established.

The report splits investors into one of five groups: Discerning, Adventurous, Organised, Cautious and Casual. The report found:

  • Confidence has fallen most among Adventurous and Casual investors whereas confidence has been broadly stable among those who are more Discerning or Cautious. 
  • Adventurous investors are not willing to take on as much risk relative to their position in May.  However, discerning investors were prepared to take on more risk than the other clusters as they understand that investing can carry some level of risk.
    All clusters except Discerning think that the uncertainty in the market will make them delay their investment plans; Discerning investors are neutral. 
  • Given the continuing falls within the property market, all clusters have little faith in property with discerning investors being the most negative toward this particular market.
  • A copy of the IMA Great British Investor report can be viewed here.  The third report will be published in July 2009.

- ENDS -

Notes to the Editor:

1. YouGov surveyed a representative cross-section of 3,004 investors in November 2008, varying in terms of age, personal wealth and where they lived. 

2. Types of investor:

Discerning investor. These investors have a good knowledge of financial matters to the point where others will come to them for advice and help. They keep up to date with financial news and matters. They look at their investments as an active hobby and believe that it is less satisfying to spend than it is to save.

Adventurous Investor. These investors have good financial knowledge and are self proficient when making financial (and investment) decisions. They regularly look at financial websites and do not find financial matters confusing. They are good at managing their own portfolios, although they now seem less prepared to accept the same level of risk relative to the appetite for risk that they expressed in the May survey. 

Organised Investor. These investors may have a good financial knowledge but unlike discerning investors they do not treat their financial affairs as an active hobby. They regularly read the financial papers, are debt averse and have an entrenched savings culture

Cautious Investor. These investors have an average financial knowledge and are not prepared to accept any level of risk. They do not always follow financial news. For them, investing is seen as a necessity and they are not prepared to lose any money even if it may yield higher returns in the long run.

Casual Investor. These investors are not financially organised and usually do not manage their financial matters well. They do not follow financial news and find financial matters confusing. In turn they do not have good financial knowledge and turn to others to help them make financial (and investment) decisions.

About Investment Management Association (IMA)
IMA is the trade body for the UK's £3.4 trillion asset management industry.  The money its members manage is in a wide variety of investment vehicles including authorised investment funds, pension funds and stocks and shares ISAs.  Its role is to represent the industry and promote high standards.

For further information, please contact:
Noreen Shah, Press Officer, IMA, 0207 831 0898
Mona Patel, Head of Communications, 07834 089332                                                   



1. Retail investors are defined as consumers who currently hold/are likely to purchase in the next 12 months: equities, unit trusts, premium bonds, investment bonds etc.  The sample was adjusted to match the characteristics of the UK population of retail investors.

2. The index has two parts: the balance of investors responding positively over those responding negatively for various groups of investors; a composite index value reflecting the overall response of all investors, with larger investors weighted more heavily than small investors.

3. As footnote 2

Investment management association