Canadians invest conservatively

By Special to MoneySense on September 24, 2015
Estimated reading time: 2 minutes

On average, we're holding 25% of our portfolios in cash

This article is 9 years old. Some details may be outdated.

Canadians are playing it safe when it comes to investing. Sun Life Global Investments’ Investor Sentiment Report finds investors are holding an average 25% of their portfolio—including both personal savings and employer-sponsored retirement plans—in cash. The rest breaks down as follows: Canadian stocks and stock mutual funds (34%); Canadian bonds and bond mutual funds (13%); foreign stocks, bonds and mutual funds (12%); ETFs (5%); and other (11%). “To the extent that foreign exposure is indicative of an investor’s risk appetite (and often his or her understanding of the importance of diversification), the 12% average holdings of foreign stocks, bonds and mutual funds is noteworthy,” the survey states. Getting the money out of your mattress » Just 16% of investors plans to invest more in foreign assets over the next year. More than half (57%) say no and 26% either don’t know or aren’t sure. Investors who plan to take on more global exposure say they’ll do so because: Investors who plan to take on more global exposure say they’ll do so because: foreign investments add valuable diversification to their portfolio (62%); foreign investments offer the potential for higher returns (61%); the Canadian economy is weak (39%); their financial advisor recommends foreign investments (22%); and Canadian investments are too risky (13%). Read: Adult kids draining parents’ retirement funds Of those who don’t plan to add foreign investments, they say it’s because: they prefer investments to be in Canadian dollars (39%); the global economy is weak (32%); foreign investments are too risky (20%); it’s too difficult to research global investment opportunities (13%); and their financial advisor doesn’t recommend them (10%). Warren Buffett still buying $500M in stocks a week » The report also finds investors have a positive view about their personal finances over the next five years. More than half (52%) are either very optimistic (14%) or somewhat optimistic (38%) about their financial future. Twenty-six percent take a neutral view, 18% are somewhat pessimistic and 4% are very pessimistic. This article originally appeared on Benefits Canada.